The shares of PNC Financial Services Group, Inc. (The) (NYSE:PNC) and Splunk Inc. (NASDAQ:SPLK) were among the active stocks of the last trading sessions. PNC Financial Services Group, Inc. (The) (NYSE:PNC) declined to -3.37% closing at the price of $131.61 whereas the shares of Splunk Inc. (NASDAQ:SPLK) soared 0.65% with the increase of 0.64 points closing at the price of $99.09. PNC Financial Services Group, Inc. (The) has currently decrease -9.52% in its stock over the period of 6-months while its rival Splunk Inc. subtracted -4.86% 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 PNC Financial Services Group, Inc. (The) (NYSE:PNC) is 8.6% while the ROI of Splunk Inc. (NASDAQ:SPLK) is -22.6%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, PNC’s EBITDA Margin is NOT AVAILABLE whereas SPLK’s is -63.32.
Both the profitability ratios suggest that PNC Financial Services Group, Inc. (The) (NYSE:PNC) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
PNC Financial Services Group, Inc. (The) (NYSE:PNC) reported $2.72/share EPS for the previous quarter where analysts were predicting an EPS to be $2.58/share Thus beating the analyst Estimates with a Surprise Factor of 5.4 Percent. While, Splunk Inc. (NASDAQ:SPLK) reported EPS of $0.08/share in the last quarter. The analysts projected EPS of $0.05/share depicting a Surprise of 60 Percent.
Taking a look at Earnings per Share, Splunk Inc. tends to be beating the analyst estimates more than PNC Financial Services Group, Inc. (The). so SPLK is more profitable than PNC.
Technical Analysis of PNC Financial Services Group, Inc. (The) & Splunk Inc.
Moving average convergence divergence (MACD) shows that PNC Financial Services Group, Inc. (The) (NYSE:PNC) is on a PRICE RELATIVITY trend While Splunk Inc. (NASDAQ:SPLK) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the PNC Financial Services Group, Inc. (The) was in BEARISH territory and Splunk Inc. was in BEARISH territory.
PNC’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While SPLK’s candle is BEARISH with HIGH.
EPS Growth Rate: PNC’s 11.55% versus SPLK’s 35.67%
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 PNC Financial Services Group, Inc. (The) (NYSE:PNC) is predicted at 11.55% while Splunk Inc. (NASDAQ:SPLK) stands at 35.67%. These numbers suggest that SPLK 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 PNC stands at 0 while SPLK is at 1.7 whereas the debt ratio of the prior is 0.79 while the debt ratio of the later is 0.
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 PNC and 1.9 for SPLK which means PNC has Hold rating whereas SPLK 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 PNC is $158.91 which is 17.18% of its current price while SPLK has price target of 132.14 which is 25.01% 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.
PNC currently has price to earning P/E ratio of 14.59 whereas SPLK has 0 while the forward P/E ratio for the prior stands at 11.31 and for the later it depicts the value of 63.44.
The price to Book P/B for PNC is 1.32, Price to Sale is at 5.28 and for SPLK these ratios stand at 12.53 and 10.15.