The shares of Pandora Media, Inc. (NYSE:P) and MetLife, Inc. (NYSE:MET) were among the active stocks of the last trading sessions. Pandora Media, Inc. (NYSE:P) soared to 1.7% closing at the price of $8.95 whereas the shares of MetLife, Inc. (NYSE:MET) declined -5.2% with the decrease of -2.4 points closing at the price of $43.76. Pandora Media, Inc. has currently increase 75.49% in its stock over the period of 6-months while its rival MetLife, Inc. subtracted -6.73% 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 Pandora Media, Inc. (NYSE:P) is -116% while the ROI of MetLife, Inc. (NYSE:MET) is 7.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, P’s EBITDA Margin is -9.98 whereas MET’s is 20.58.
Both the profitability ratios suggest that MetLife, Inc. (NYSE:MET) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Pandora Media, Inc. (NYSE:P) reported $-0.15/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.16/share Thus beating the analyst Estimates with a Surprise Factor of 6.3 Percent. While, MetLife, Inc. (NYSE:MET) reported EPS of $1.3/share in the last quarter. The analysts projected EPS of $1.17/share depicting a Surprise of 11.1 Percent.
Taking a look at Earnings per Share, MetLife, Inc. tends to be beating the analyst estimates more than Pandora Media, Inc.. so MET is more profitable than P.
Technical Analysis of Pandora Media, Inc. & MetLife, Inc.
Moving average convergence divergence (MACD) shows that Pandora Media, Inc. (NYSE:P) is on a PRICE RELATIVITY trend While MetLife, Inc. (NYSE:MET) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Pandora Media, Inc. was in BEARISH territory and MetLife, Inc. was in BEARISH territory.
P’s current statistics gauge that the stock candle is BULLISH with LOW volatility. While MET’s candle is BEARISH with HIGH.
EPS Growth Rate: P’s 10% versus MET’s 12.55%
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 Pandora Media, Inc. (NYSE:P) is predicted at 10% while MetLife, Inc. (NYSE:MET) stands at 12.55%. These numbers suggest that MET 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 P stands at 2.7 while MET is at 0 whereas the debt ratio of the prior is 2.76 while the debt ratio of the later is 0.34.
The values of the both ratios suggest that P is more suitable investment when the liquidity and risk is the main concern.
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 P and 2.4 for MET which means P has Hold rating whereas MET 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 P is $9.46 which is 5.39% of its current price while MET has price target of 53.5 which is 18.21% 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.
P currently has price to earning P/E ratio of 0 whereas MET has 9.18 while the forward P/E ratio for the prior stands at 0 and for the later it depicts the value of 7.95.
The price to Book P/B for P is 25.57, Price to Sale is at 1.62 and for MET these ratios stand at 0.83 and 0.65.