The shares of HD Supply Holdings, Inc. (NASDAQ:HDS) and Pacific Ethanol, Inc. (NASDAQ:PEIX) were among the active stocks of the last trading sessions. HD Supply Holdings, Inc. (NASDAQ:HDS) declined to -3.67% closing at the price of $38.03 whereas the shares of Pacific Ethanol, Inc. (NASDAQ:PEIX) soared 2.12% with the increase of 0.05 points closing at the price of $2.41. HD Supply Holdings, Inc. has currently decrease -0.11% in its stock over the period of 6-months while its rival Pacific Ethanol, Inc. subtracted -26.97% 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 HD Supply Holdings, Inc. (NASDAQ:HDS) is 11% while the ROI of Pacific Ethanol, Inc. (NASDAQ:PEIX) is -4.3%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, HDS’s EBITDA Margin is 12.78 whereas PEIX’s is 17.28.
Both the profitability ratios suggest a mixed sentiment for HD Supply Holdings, Inc. (NASDAQ:HDS) and Pacific Ethanol, Inc. (NASDAQ:PEIX).
EPS & Surprise Factor
HD Supply Holdings, Inc. (NASDAQ:HDS) reported $0.99/share EPS for the previous quarter where analysts were predicting an EPS to be $0.96/share Thus beating the analyst Estimates with a Surprise Factor of 3.1 Percent. While, Pacific Ethanol, Inc. (NASDAQ:PEIX) reported EPS of $-0.31/share in the last quarter. The analysts projected EPS of $-0.19/share depicting a Surprise of -63.2 Percent.
Taking a look at Earnings per Share, HD Supply Holdings, Inc. tends to be beating the analyst estimates more than Pacific Ethanol, Inc.. so HDS is more profitable than PEIX.
Technical Analysis of HD Supply Holdings, Inc. & Pacific Ethanol, Inc.
Moving average convergence divergence (MACD) shows that HD Supply Holdings, Inc. (NASDAQ:HDS) is on a PRICE RELATIVITY trend While Pacific Ethanol, Inc. (NASDAQ:PEIX) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the HD Supply Holdings, Inc. was in BEARISH territory and Pacific Ethanol, Inc. was in BULLISH territory.
HDS’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While PEIX’s candle is BEARISH with HIGH.
EPS Growth Rate: HDS’s 12.1% versus PEIX’s 20%
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 HD Supply Holdings, Inc. (NASDAQ:HDS) is predicted at 12.1% while Pacific Ethanol, Inc. (NASDAQ:PEIX) stands at 20%. These numbers suggest that PEIX 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 HDS stands at 2.3 while PEIX is at 2.2 whereas the debt ratio of the prior is 1.3 while the debt ratio of the later is 0.77.
The values of the both ratios suggest that HDS 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 1.9 for HDS and 2 for PEIX which means HDS has Buy rating whereas PEIX has Buy 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 HDS is $49.33 which is 22.91% of its current price while PEIX has price target of 9.5 which is 74.63% 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.
HDS currently has price to earning P/E ratio of 22.02 whereas PEIX has 0 while the forward P/E ratio for the prior stands at 11.52 and for the later it depicts the value of 9.72.
The price to Book P/B for HDS is 4.33, Price to Sale is at 1.27 and for PEIX these ratios stand at 0.31 and 0.07.