The shares of Jabil Inc. (NYSE:JBL) and LyondellBasell Industries NV (NYSE:LYB) were among the active stocks of the last trading sessions. Jabil Inc. (NYSE:JBL) declined to -1.3% closing at the price of $23.5 whereas the shares of LyondellBasell Industries NV (NYSE:LYB) declined -0.6% with the decrease of -0.59 points closing at the price of $97.03. Jabil Inc. has currently decrease -19.6% in its stock over the period of 6-months while its rival LyondellBasell Industries NV subtracted -5.83% 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 Jabil Inc. (NYSE:JBL) is 6.3% while the ROI of LyondellBasell Industries NV (NYSE:LYB) is 23%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, JBL’s EBITDA Margin is 4.12 whereas LYB’s is 6.58.
Both the profitability ratios suggest that LyondellBasell Industries NV (NYSE:LYB) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Jabil Inc. (NYSE:JBL) reported $0.7/share EPS for the previous quarter where analysts were predicting an EPS to be $0.68/share Thus beating the analyst Estimates with a Surprise Factor of 2.9 Percent. While, LyondellBasell Industries NV (NYSE:LYB) reported EPS of $3.34/share in the last quarter. The analysts projected EPS of $2.92/share depicting a Surprise of 14.4 Percent.
Taking a look at Earnings per Share, LyondellBasell Industries NV tends to be beating the analyst estimates more than Jabil Inc.. so LYB is more profitable than JBL.
Technical Analysis of Jabil Inc. & LyondellBasell Industries NV
Moving average convergence divergence (MACD) shows that Jabil Inc. (NYSE:JBL) is on a PRICE RELATIVITY trend While LyondellBasell Industries NV (NYSE:LYB) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Jabil Inc. was in BEARISH territory and LyondellBasell Industries NV was in BEARISH territory.
JBL’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While LYB’s candle is BEARISH with HIGH.
EPS Growth Rate: JBL’s 12% versus LYB’s 8.1%
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 Jabil Inc. (NYSE:JBL) is predicted at 12% while LyondellBasell Industries NV (NYSE:LYB) stands at 8.1%. These numbers suggest that JBL 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 JBL stands at 1 while LYB is at 2.3 whereas the debt ratio of the prior is 1.13 while the debt ratio of the later is 0.81.
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 2.7 for JBL and 2.8 for LYB which means JBL has Hold rating whereas LYB 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 JBL is $33.2 which is 29.22% of its current price while LYB has price target of 116.37 which is 16.62% 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.
JBL currently has price to earning P/E ratio of 17.95 whereas LYB has 7.62 while the forward P/E ratio for the prior stands at 7.05 and for the later it depicts the value of 8.58.
The price to Book P/B for JBL is 1.84, Price to Sale is at 0.18 and for LYB these ratios stand at 3.58 and 1.01.