The shares of Altaba Inc. (NASDAQ:AABA) and KeyCorp (NYSE:KEY) were among the active stocks of the last trading sessions. Altaba Inc. (NASDAQ:AABA) declined to -2.31% closing at the price of $63.09 whereas the shares of KeyCorp (NYSE:KEY) soared 1.13% with the increase of 0.23 points closing at the price of $20.52. Altaba Inc. has currently decrease -10.86% in its stock over the period of 6-months while its rival KeyCorp added 4.53% in the previous 6-months.
Now we have to analyze the facts that if the stocks were worthy off investors’ money? The facts to analyze here are risks, profitability, returns and price trends.
Returns and Profitability
Profitability and returns are the main reason of investment, the investors are looking for profits that they get and return they should expect over the period of time.
The first and foremost return that is considered while making an investment is the ROI or Return on Investment. The ROI is the ratio between the profit against the cost of investment. Currently the ROI of Altaba Inc. (NASDAQ:AABA) is 8.6% while the ROI of KeyCorp (NYSE:KEY) is 10.8%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, AABA’s EBITDA Margin is 302.79 whereas KEY’s is NOT AVAILABLE.
Both the profitability ratios suggest that KeyCorp (NYSE:KEY) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Altaba Inc. (NASDAQ:AABA) reported $0.18/share EPS for the previous quarter where analysts were predicting an EPS to be $0.14/share Thus beating the analyst Estimates with a Surprise Factor of 28.6 Percent. While, KeyCorp (NYSE:KEY) reported EPS of $0.44/share in the last quarter. The analysts projected EPS of $0.42/share depicting a Surprise of 4.8 Percent.
Taking a look at Earnings per Share, Altaba Inc. tends to be beating the analyst estimates more than KeyCorp. so AABA is more profitable than KEY.
Technical Analysis of Altaba Inc. & KeyCorp
Moving average convergence divergence (MACD) shows that Altaba Inc. (NASDAQ:AABA) is on a PRICE RELATIVITY trend While KeyCorp (NYSE:KEY) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Altaba Inc. was in BEARISH territory and KeyCorp was in BULLISH territory.
AABA’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While KEY’s candle is BULLISH with MEDIUM.
EPS Growth Rate: AABA’s -0.83% versus KEY’s 9.5%
Another shareholder value can be analyzed through the EPS growth rate; the next 5 years EPS growth rate is predicted by the analysts after the analyzing the previous trends. The next 5 year EPS growth rate of Altaba Inc. (NASDAQ:AABA) is predicted at -0.83% while KeyCorp (NYSE:KEY) stands at 9.5%. These numbers suggest that KEY is more suitable investment in terms of EPS growth rate.
Financial Risk and Liquidity Concerns
The current ratio and the debt ratio are the two ratios that show the investor how quickly the company is able to payout its debt and how quickly it can cover its obligations. The current ratio of AABA stands at 0 while KEY is at 0 whereas the debt ratio of the prior is 0.07 while the debt ratio of the later is 0.98.
The values of the both ratios suggest that KEY is more suitable investment when the liquidity and risk is the main concern.
While making an investment, another main factor to consider before investing is the analyst recommendation on the scale of 1 to 5 where 1 is strong buy, 2 is buy, 3 is hold, 4 is Sell and 5 is strong sell. Analyst recommend 2.4 for AABA and 2 for KEY which means AABA has Hold rating whereas KEY has Buy rating.
Another recommendation of analyst that is to be considered worthy is the price target. The mare price or price trend does not suggest the suitability of a stock. The price target set by analyst is also to be considered while investing as it suggests to what extent the stock will rise or fall in the near future. The price target set for AABA is $97.75 which is 35.46% of its current price while KEY has price target of 23.56 which is 12.9% of its current price.
Valuation is the process of determining the company’s worth for an investor, the valuation ratios give an insight to that worthiness.
AABA currently has price to earning P/E ratio of 2.27 whereas KEY has 14.3 while the forward P/E ratio for the prior stands at 0 and for the later it depicts the value of 10.73.
The price to Book P/B for AABA is 0.81, Price to Sale is at 148.02 and for KEY these ratios stand at 1.53 and 4.76.