Which Stock will you hold for a while? NVIDIA Corporation (NVDA) or Marvell Technology Group Ltd. (MRVL)

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The shares of NVIDIA Corporation (NASDAQ:NVDA) and Marvell Technology Group Ltd. (NASDAQ:MRVL) were among the active stocks of the last trading sessions. NVIDIA Corporation (NASDAQ:NVDA) declined to -4.3% closing at the price of $235.13 whereas the shares of Marvell Technology Group Ltd. (NASDAQ:MRVL) soared 1.96% with the increase of 0.34 points closing at the price of $17.72. NVIDIA Corporation has currently increase 1.57% in its stock over the period of 6-months while its rival Marvell Technology Group Ltd. subtracted -19.49% 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 NVIDIA Corporation (NASDAQ:NVDA) is 30.9% while the ROI of Marvell Technology Group Ltd. (NASDAQ:MRVL) is 10.1%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, NVDA’s EBITDA Margin is 34.09 whereas MRVL’s is 22.42.

Both the profitability ratios suggest that NVIDIA Corporation (NASDAQ:NVDA) is more suitable investment in terms of profitability and return.

EPS & Surprise Factor

NVIDIA Corporation (NASDAQ:NVDA) reported $1.76/share EPS for the previous quarter where analysts were predicting an EPS to be $1.66/share Thus beating the analyst Estimates with a Surprise Factor of 6 Percent. While, Marvell Technology Group Ltd. (NASDAQ:MRVL) reported EPS of $0.28/share in the last quarter. The analysts projected EPS of $0.35/share depicting a Surprise of -20 Percent.

Taking a look at Earnings per Share, NVIDIA Corporation tends to be beating the analyst estimates more than Marvell Technology Group Ltd.. so NVDA is more profitable than MRVL.

Technical Analysis of NVIDIA Corporation & Marvell Technology Group Ltd.

Moving average convergence divergence (MACD) shows that NVIDIA Corporation (NASDAQ:NVDA) is on a PRICE RELATIVITY trend While Marvell Technology Group Ltd. (NASDAQ:MRVL) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the NVIDIA Corporation was in BEARISH territory and Marvell Technology Group Ltd. was in BEARISH territory.

NVDA’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While MRVL’s candle is BULLISH with HIGH.

EPS Growth Rate: NVDA’s 17.16% versus MRVL’s 14.1%

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 NVIDIA Corporation (NASDAQ:NVDA) is predicted at 17.16% while Marvell Technology Group Ltd. (NASDAQ:MRVL) stands at 14.1%. These numbers suggest that NVDA 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 NVDA stands at 7.4 while MRVL is at 2.5 whereas the debt ratio of the prior is 0.23 while the debt ratio of the later is 0.25.

The values of the both ratios suggest that one is more liquid and other investment is more risk free.

Analyst Recommendations

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 2.1 for NVDA and 2.1 for MRVL which means NVDA has Hold rating whereas MRVL 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 NVDA is $297.21 which is 20.89% of its current price while MRVL has price target of 27.17 which is 34.78% of its current price.

Valuation Ratios

Valuation is the process of determining the company’s worth for an investor, the valuation ratios give an insight to that worthiness.

NVDA currently has price to earning P/E ratio of 35.38 whereas MRVL has 26.97 while the forward P/E ratio for the prior stands at 29.27 and for the later it depicts the value of 11.63.

The price to Book P/B for NVDA is 16.23, Price to Sale is at 12.46 and for MRVL these ratios stand at 1.28 and 4.83.