The shares of KeyCorp (NYSE:KEY) and Bristol-Myers Squibb Company (NYSE:BMY) were among the active stocks of the last trading sessions. KeyCorp (NYSE:KEY) declined to -3.41% closing at the price of $19.24 whereas the shares of Bristol-Myers Squibb Company (NYSE:BMY) declined -5.38% with the decrease of -3.27 points closing at the price of $57.5. KeyCorp has currently increase 0% in its stock over the period of 6-months while its rival Bristol-Myers Squibb Company subtracted -1.96% 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 KeyCorp (NYSE:KEY) is 10.8% while the ROI of Bristol-Myers Squibb Company (NYSE:BMY) is 20.2%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, KEY’s EBITDA Margin is NOT AVAILABLE whereas BMY’s is 17.43.
Both the profitability ratios suggest a mixed sentiment for KeyCorp (NYSE:KEY) and Bristol-Myers Squibb Company (NYSE:BMY).
EPS & Surprise Factor
KeyCorp (NYSE:KEY) reported $0.44/share EPS for the previous quarter where analysts were predicting an EPS to be $0.42/share Thus beating the analyst Estimates with a Surprise Factor of 4.8 Percent. While, Bristol-Myers Squibb Company (NYSE:BMY) reported EPS of $1.01/share in the last quarter. The analysts projected EPS of $0.87/share depicting a Surprise of 16.1 Percent.
Taking a look at Earnings per Share, Bristol-Myers Squibb Company tends to be beating the analyst estimates more than KeyCorp. so BMY is more profitable than KEY.
Technical Analysis of KeyCorp & Bristol-Myers Squibb Company
Moving average convergence divergence (MACD) shows that KeyCorp (NYSE:KEY) is on a PRICE RELATIVITY trend While Bristol-Myers Squibb Company (NYSE:BMY) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the KeyCorp was in BULLISH territory and Bristol-Myers Squibb Company was in BEARISH territory.
KEY’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While BMY’s candle is BEARISH with HIGH.
EPS Growth Rate: KEY’s 9.5% versus BMY’s 10.97%
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 KeyCorp (NYSE:KEY) is predicted at 9.5% while Bristol-Myers Squibb Company (NYSE:BMY) stands at 10.97%. These numbers suggest that BMY 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 KEY stands at 0 while BMY is at 1.4 whereas the debt ratio of the prior is 0.98 while the debt ratio of the later is 0.6.
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 for KEY and 2.4 for BMY which means KEY has Buy rating whereas BMY 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 KEY is $23.56 which is 18.34% of its current price while BMY has price target of 60.5 which is 4.96% 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.
KEY currently has price to earning P/E ratio of 13.41 whereas BMY has 28.56 while the forward P/E ratio for the prior stands at 10.06 and for the later it depicts the value of 14.73.
The price to Book P/B for KEY is 1.44, Price to Sale is at 4.47 and for BMY these ratios stand at 7.63 and 4.34.