The shares of Oasis Petroleum Inc. (NYSE:OAS) and Gold Fields Limited (NYSE:GFI) were among the active stocks of the last trading sessions. Oasis Petroleum Inc. (NYSE:OAS) declined to -4.85% closing at the price of $11.97 whereas the shares of Gold Fields Limited (NYSE:GFI) soared 6.08% with the increase of 0.16 points closing at the price of $2.79. Oasis Petroleum Inc. has currently increase 34.95% in its stock over the period of 6-months while its rival Gold Fields Limited subtracted -28.64% 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 Oasis Petroleum Inc. (NYSE:OAS) is 3.2% while the ROI of Gold Fields Limited (NYSE:GFI) is 4.8%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, OAS’s EBITDA Margin is 7.36 whereas GFI’s is 2.89.
Both the profitability ratios suggest a mixed sentiment for Oasis Petroleum Inc. (NYSE:OAS) and Gold Fields Limited (NYSE:GFI).
EPS & Surprise Factor
Technical Analysis of Oasis Petroleum Inc. & Gold Fields Limited
Moving average convergence divergence (MACD) shows that Oasis Petroleum Inc. (NYSE:OAS) is on a PRICE RELATIVITY trend While Gold Fields Limited (NYSE:GFI) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Oasis Petroleum Inc. was in BEARISH territory and Gold Fields Limited was in BULLISH territory.
OAS’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While GFI’s candle is BULLISH with HIGH.
EPS Growth Rate: OAS’s 0% versus GFI’s 0%
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 Oasis Petroleum Inc. (NYSE:OAS) is predicted at 0% while Gold Fields Limited (NYSE:GFI) stands at 0%. These numbers suggest that GFI 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 OAS stands at 0.5 while GFI is at 1.1 whereas the debt ratio of the prior is 0.8 while the debt ratio of the later is 0.69.
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 2.3 for OAS and 2 for GFI which means OAS has Hold rating whereas GFI 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 OAS is $15.87 which is 24.57% of its current price while GFI has price target of 4.05 which is 31.11% 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.
OAS currently has price to earning P/E ratio of 0 whereas GFI has 0 while the forward P/E ratio for the prior stands at 12.61 and for the later it depicts the value of 10.73.
The price to Book P/B for OAS is 1.09, Price to Sale is at 2.42 and for GFI these ratios stand at 0.84 and 0.8.