The shares of Noble Corporation (NYSE:NE) and Altria Group (NYSE:MO) were among the active stocks of the last trading sessions. Noble Corporation (NYSE:NE) declined to -8.07% closing at the price of $6.61 whereas the shares of Altria Group (NYSE:MO) declined -0.3% with the decrease of -0.19 points closing at the price of $62.91. Noble Corporation has currently increase 55.53% in its stock over the period of 6-months while its rival Altria Group subtracted -0.77% 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 Noble Corporation (NYSE:NE) is -3.4% while the ROI of Altria Group (NYSE:MO) is 24%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, NE’s EBITDA Margin is 14.14 whereas MO’s is 12.86.
Both the profitability ratios suggest a mixed sentiment for Noble Corporation (NYSE:NE) and Altria Group (NYSE:MO).
EPS & Surprise Factor
Noble Corporation (NYSE:NE) reported $-0.49/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.48/share Thus lagging the analyst Estimates with a Surprise Factor of -2.1 Percent. While, Altria Group (NYSE:MO) reported EPS of $1.01/share in the last quarter. The analysts projected EPS of $1/share depicting a Surprise of 1 Percent.
Taking a look at Earnings per Share, Altria Group tends to be beating the analyst estimates more than Noble Corporation. so MO is more profitable than NE.
Technical Analysis of Noble Corporation & Altria Group
Moving average convergence divergence (MACD) shows that Noble Corporation (NYSE:NE) is on a PRICE RELATIVITY trend While Altria Group (NYSE:MO) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Noble Corporation was in BULLISH territory and Altria Group was in BULLISH territory.
NE’s current statistics gauge that the stock candle is BEARISH with LOW volatility. While MO’s candle is BULLISH with HIGH.
EPS Growth Rate: NE’s 5.99% versus MO’s 10.14%
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 Noble Corporation (NYSE:NE) is predicted at 5.99% while Altria Group (NYSE:MO) stands at 10.14%. These numbers suggest that MO 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 NE stands at 2.1 while MO is at 0.6 whereas the debt ratio of the prior is 0.88 while the debt ratio of the later is 0.88.
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 3.1 for NE and 2.1 for MO which means NE has Sell rating whereas MO 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 NE is $6.19 which is -6.79% of its current price while MO has price target of 67.52 which is 6.83% 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.
NE currently has price to earning P/E ratio of 0 whereas MO has 16.38 while the forward P/E ratio for the prior stands at 0 and for the later it depicts the value of 14.43.
The price to Book P/B for NE is 0.37, Price to Sale is at 1.5 and for MO these ratios stand at 7.53 and 4.71.