The shares of Planet Fitness, Inc. (NYSE:PLNT) and Azul S.A. (NYSE:AZUL) were among the active stocks of the last trading sessions. Planet Fitness, Inc. (NYSE:PLNT) soared to 0.45% closing at the price of $48.63 whereas the shares of Azul S.A. (NYSE:AZUL) soared 3.51% with the increase of 0.77 points closing at the price of $22.72. Planet Fitness, Inc. has currently increase 25.95% in its stock over the period of 6-months while its rival Azul S.A. subtracted -29.59% 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 Planet Fitness, Inc. (NYSE:PLNT) is 18.6% while the ROI of Azul S.A. (NYSE:AZUL) is 12.6%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, PLNT’s EBITDA Margin is 24.81 whereas AZUL’s is 10.95.
Both the profitability ratios suggest that Planet Fitness, Inc. (NYSE:PLNT) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Planet Fitness, Inc. (NYSE:PLNT) reported $0.34/share EPS for the previous quarter where analysts were predicting an EPS to be $0.31/share Thus beating the analyst Estimates with a Surprise Factor of 9.7 Percent. While, Azul S.A. (NYSE:AZUL) reported EPS of $0.57/share in the last quarter. The analysts projected EPS of $-0.32/share depicting a Surprise of 278.1 Percent.
Taking a look at Earnings per Share, Azul S.A. tends to be beating the analyst estimates more than Planet Fitness, Inc.. so AZUL is more profitable than PLNT.
Technical Analysis of Planet Fitness, Inc. & Azul S.A.
Moving average convergence divergence (MACD) shows that Planet Fitness, Inc. (NYSE:PLNT) is on a PRICE RELATIVITY trend While Azul S.A. (NYSE:AZUL) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Planet Fitness, Inc. was in BEARISH territory and Azul S.A. was in BULLISH territory.
PLNT’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While AZUL’s candle is BULLISH with HIGH.
EPS Growth Rate: PLNT’s 18.5% versus AZUL’s 0%
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 Planet Fitness, Inc. (NYSE:PLNT) is predicted at 18.5% while Azul S.A. (NYSE:AZUL) stands at 0%. These numbers suggest that PLNT 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 PLNT stands at 2.1 while AZUL is at 0.9 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 1.34.
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 1.9 for PLNT and 1.6 for AZUL which means PLNT has Buy rating whereas AZUL 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 PLNT is $55.08 which is 11.71% of its current price while AZUL has price target of 28.89 which is 21.36% 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.
PLNT currently has price to earning P/E ratio of 10.74 whereas AZUL has 10.67 while the forward P/E ratio for the prior stands at 35.11 and for the later it depicts the value of 9.37.
The price to Book P/B for PLNT is 0, Price to Sale is at 9.99 and for AZUL these ratios stand at 3.58 and 1.13.