The shares of United States Steel Corporation (NYSE:X) and Cabot Oil & Gas Corporation (NYSE:COG) were among the active stocks of the last trading sessions. United States Steel Corporation (NYSE:X) soared to 0.29% closing at the price of $28.15 whereas the shares of Cabot Oil & Gas Corporation (NYSE:COG) declined -3.37% with the decrease of -0.81 points closing at the price of $23.19. United States Steel Corporation has currently decrease -20.73% in its stock over the period of 6-months while its rival Cabot Oil & Gas Corporation subtracted -2.03% 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 Cabot Oil & Gas Corporation (NYSE:COG) is -1.6%. 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 COG’s is 12.88.
Both the profitability ratios suggest a mixed sentiment for United States Steel Corporation (NYSE:X) and Cabot Oil & Gas Corporation (NYSE:COG).
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, Cabot Oil & Gas Corporation (NYSE:COG) reported EPS of $0.13/share in the last quarter. The analysts projected EPS of $0.19/share depicting a Surprise of -31.6 Percent.
Taking a look at Earnings per Share, United States Steel Corporation tends to be beating the analyst estimates more than Cabot Oil & Gas Corporation. so X is more profitable than COG.
Technical Analysis of United States Steel Corporation & Cabot Oil & Gas Corporation
Moving average convergence divergence (MACD) shows that United States Steel Corporation (NYSE:X) is on a PRICE RELATIVITY trend While Cabot Oil & Gas Corporation (NYSE:COG) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the United States Steel Corporation was in BEARISH territory and Cabot Oil & Gas Corporation was in BULLISH territory.
X’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While COG’s candle is BEARISH with HIGH.
EPS Growth Rate: X’s 19.07% versus COG’s 48.82%
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 Cabot Oil & Gas Corporation (NYSE:COG) stands at 48.82%. These numbers suggest that COG 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 COG is at 1.7 whereas the debt ratio of the prior is 0.71 while the debt ratio of the later is 0.71.
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 2.4 for COG which means X has Hold rating whereas COG 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 33.66% of its current price while COG has price target of 27.46 which is 15.55% 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 10.95 whereas COG has 0 while the forward P/E ratio for the prior stands at 4.61 and for the later it depicts the value of 14.09.
The price to Book P/B for X is 1.38, Price to Sale is at 0.39 and for COG these ratios stand at 4.85 and 5.94.