Which is the most compelling pick right now? Praxair, Inc. (PX) or North American Construction Group Ltd. (NOA)

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The shares of Praxair, Inc. (NYSE:PX) and North American Construction Group Ltd. (NYSE:NOA) were among the active stocks of the last trading sessions. Praxair, Inc. (NYSE:PX) declined to -1.9% closing at the price of $161.18 whereas the shares of North American Construction Group Ltd. (NYSE:NOA) declined -13.83% with the decrease of -1.72 points closing at the price of $10.72. Praxair, Inc. has currently increase 11.47% in its stock over the period of 6-months while its rival North American Construction Group Ltd. added 78.67% 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 Praxair, Inc. (NYSE:PX) is 12.1% while the ROI of North American Construction Group Ltd. (NYSE:NOA) is 4.3%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, PX’s EBITDA Margin is 14.28 whereas NOA’s is NOT AVAILABLE.

Both the profitability ratios suggest a mixed sentiment for Praxair, Inc. (NYSE:PX) and North American Construction Group Ltd. (NYSE:NOA).

EPS & Surprise Factor

Praxair, Inc. (NYSE:PX) reported $1.72/share EPS for the previous quarter where analysts were predicting an EPS to be $1.69/share Thus beating the analyst Estimates with a Surprise Factor of 1.8 Percent. While, North American Construction Group Ltd. (NYSE:NOA) reported EPS of $0.28/share in the last quarter. The analysts projected EPS of $0.28/share depicting a Surprise of 0 Percent.

Taking a look at Earnings per Share, Praxair, Inc. tends to be beating the analyst estimates more than North American Construction Group Ltd.. so PX is more profitable than NOA.

Technical Analysis of Praxair, Inc. & North American Construction Group Ltd.

Moving average convergence divergence (MACD) shows that Praxair, Inc. (NYSE:PX) is on a PRICE RELATIVITY trend While North American Construction Group Ltd. (NYSE:NOA) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Praxair, Inc. was in BULLISH territory and North American Construction Group Ltd. was in BULLISH territory.

PX’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While NOA’s candle is BEARISH with HIGH.

EPS Growth Rate: PX’s 10.73% versus NOA’s 11%

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 Praxair, Inc. (NYSE:PX) is predicted at 10.73% while North American Construction Group Ltd. (NYSE:NOA) stands at 11%. These numbers suggest that NOA 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 PX stands at 1 while NOA is at 0.9 whereas the debt ratio of the prior is 1.4 while the debt ratio of the later is 0.87.

The values of the both ratios suggest that PX is more suitable investment when the liquidity and risk is the main concern.

Analyst Recommendations

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 2.3 for PX and 2 for NOA which means PX has Hold rating whereas NOA 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 PX is $172.69 which is 6.67% of its current price while NOA has price target of 7.64 which is -40.31% of its current price.

Valuation Ratios

Valuation is the process of determining the company’s worth for an investor, the valuation ratios give an insight to that worthiness.

PX currently has price to earning P/E ratio of 26.19 whereas NOA has 33.4 while the forward P/E ratio for the prior stands at 21.81 and for the later it depicts the value of 16.29.

The price to Book P/B for PX is 7.7, Price to Sale is at 3.92 and for NOA these ratios stand at 2.27 and 1.07.