The shares of Himax Technologies, Inc. (NASDAQ:HIMX) and Sempra Energy (NYSE:SRE) were among the active stocks of the last trading sessions. Himax Technologies, Inc. (NASDAQ:HIMX) declined to -2.1% closing at the price of $6.07 whereas the shares of Sempra Energy (NYSE:SRE) declined -0.13% with the decrease of -0.15 points closing at the price of $116.4. Himax Technologies, Inc. has currently decrease -15.69% in its stock over the period of 6-months while its rival Sempra Energy added 4.87% 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 Himax Technologies, Inc. (NASDAQ:HIMX) is 0.6% while the ROI of Sempra Energy (NYSE:SRE) is 4.8%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, HIMX’s EBITDA Margin is 43.18 whereas SRE’s is 16.33.
Both the profitability ratios suggest a mixed sentiment for Himax Technologies, Inc. (NASDAQ:HIMX) and Sempra Energy (NYSE:SRE).
EPS & Surprise Factor
Himax Technologies, Inc. (NASDAQ:HIMX) reported $0.01/share EPS for the previous quarter where analysts were predicting an EPS to be $0.01/share Thus meeting the analyst Estimates with a Surprise Factor of 0 Percent. While, Sempra Energy (NYSE:SRE) reported EPS of $1.35/share in the last quarter. The analysts projected EPS of $1.19/share depicting a Surprise of 13.4 Percent.
Taking a look at Earnings per Share, Sempra Energy tends to be beating the analyst estimates more than Himax Technologies, Inc.. so SRE is more profitable than HIMX.
Technical Analysis of Himax Technologies, Inc. & Sempra Energy
Moving average convergence divergence (MACD) shows that Himax Technologies, Inc. (NASDAQ:HIMX) is on a PRICE RELATIVITY trend While Sempra Energy (NYSE:SRE) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Himax Technologies, Inc. was in BULLISH territory and Sempra Energy was in BULLISH territory.
HIMX’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While SRE’s candle is BEARISH with MEDIUM.
EPS Growth Rate: HIMX’s 25% versus SRE’s 8.89%
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 Himax Technologies, Inc. (NASDAQ:HIMX) is predicted at 25% while Sempra Energy (NYSE:SRE) stands at 8.89%. These numbers suggest that HIMX 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 HIMX stands at 1.8 while SRE is at 0.6 whereas the debt ratio of the prior is 0.34 while the debt ratio of the later is 1.85.
The values of the both ratios suggest that one is more liquid and other investment is more risk free.
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 2.8 for HIMX and 2 for SRE which means HIMX has Hold rating whereas SRE 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 HIMX is $7.5 which is 19.07% of its current price while SRE has price target of 124.5 which is 6.51% 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.
HIMX currently has price to earning P/E ratio of 40.74 whereas SRE has 126.94 while the forward P/E ratio for the prior stands at 25.94 and for the later it depicts the value of 19.21.
The price to Book P/B for HIMX is 1.19, Price to Sale is at 1.52 and for SRE these ratios stand at 2.19 and 2.83.