The shares of United States Steel Corporation (NYSE:X) and BlackBerry Limited (NYSE:BB) were among the active stocks of the last trading sessions. United States Steel Corporation (NYSE:X) declined to -0.98% closing at the price of $29.22 whereas the shares of BlackBerry Limited (NYSE:BB) declined -1.81% with the decrease of -0.18 points closing at the price of $9.76. United States Steel Corporation has currently decrease -15.89% in its stock over the period of 6-months while its rival BlackBerry Limited subtracted -5.7% 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 United States Steel Corporation (NYSE:X) is 9.3% while the ROI of BlackBerry Limited (NYSE:BB) is 10.6%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, X’s EBITDA Margin is 5.3 whereas BB’s is 61.36.
Both the profitability ratios suggest that BlackBerry Limited (NYSE:BB) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
United States Steel Corporation (NYSE:X) reported $1.46/share EPS for the previous quarter where analysts were predicting an EPS to be $1.13/share Thus beating the analyst Estimates with a Surprise Factor of 29.2 Percent. While, BlackBerry Limited (NYSE:BB) reported EPS of $0.04/share in the last quarter. The analysts projected EPS of $0.01/share depicting a Surprise of 300 Percent.
Taking a look at Earnings per Share, BlackBerry Limited tends to be beating the analyst estimates more than United States Steel Corporation. so BB is more profitable than X.
Technical Analysis of United States Steel Corporation & BlackBerry Limited
Moving average convergence divergence (MACD) shows that United States Steel Corporation (NYSE:X) is on a PRICE RELATIVITY trend While BlackBerry Limited (NYSE:BB) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the United States Steel Corporation was in BEARISH territory and BlackBerry Limited was in BEARISH territory.
X’s current statistics gauge that the stock candle is BULLISH with LOW volatility. While BB’s candle is BEARISH with HIGH.
EPS Growth Rate: X’s 19.07% versus BB’s 23.84%
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 United States Steel Corporation (NYSE:X) is predicted at 19.07% while BlackBerry Limited (NYSE:BB) stands at 23.84%. These numbers suggest that BB 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 X stands at 1.7 while BB is at 6.4 whereas the debt ratio of the prior is 0.71 while the debt ratio of the later is 0.3.
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 2.4 for X and 2.7 for BB which means X has Hold rating whereas BB has Hold 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 X is $42.43 which is 31.13% of its current price while BB has price target of 11.79 which is 17.22% 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.
X currently has price to earning P/E ratio of 11.37 whereas BB has 0 while the forward P/E ratio for the prior stands at 4.79 and for the later it depicts the value of 54.22.
The price to Book P/B for X is 1.44, Price to Sale is at 0.4 and for BB these ratios stand at 2.15 and 6.1.