The shares of TJX Companies, Inc. (The) (NYSE:TJX) and Qudian Inc. (NYSE:QD) were among the active stocks of the last trading sessions. TJX Companies, Inc. (The) (NYSE:TJX) declined to -0.81% closing at the price of $107.76 whereas the shares of Qudian Inc. (NYSE:QD) soared 0.7% with the increase of 0.03 points closing at the price of $4.34. TJX Companies, Inc. (The) has currently increase 32.61% in its stock over the period of 6-months while its rival Qudian Inc. subtracted -58.51% 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 TJX Companies, Inc. (The) (NYSE:TJX) is 33% while the ROI of Qudian Inc. (NYSE:QD) is 12%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, TJX’s EBITDA Margin is 13.64 whereas QD’s is 5.34.
Both the profitability ratios suggest that TJX Companies, Inc. (The) (NYSE:TJX) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
TJX Companies, Inc. (The) (NYSE:TJX) reported $1.17/share EPS for the previous quarter where analysts were predicting an EPS to be $1.05/share Thus beating the analyst Estimates with a Surprise Factor of 11.4 Percent. While, Qudian Inc. (NYSE:QD) reported EPS of $0.32/share in the last quarter. The analysts projected EPS of $0.23/share depicting a Surprise of 39.1 Percent.
Taking a look at Earnings per Share, Qudian Inc. tends to be beating the analyst estimates more than TJX Companies, Inc. (The). so QD is more profitable than TJX.
Technical Analysis of TJX Companies, Inc. (The) & Qudian Inc.
Moving average convergence divergence (MACD) shows that TJX Companies, Inc. (The) (NYSE:TJX) is on a PRICE RELATIVITY trend While Qudian Inc. (NYSE:QD) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the TJX Companies, Inc. (The) was in BEARISH territory and Qudian Inc. was in BEARISH territory.
TJX’s current statistics gauge that the stock candle is BEARISH with MEDIUM volatility. While QD’s candle is BULLISH with HIGH.
EPS Growth Rate: TJX’s 11.54% versus QD’s 3.48%
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 TJX Companies, Inc. (The) (NYSE:TJX) is predicted at 11.54% while Qudian Inc. (NYSE:QD) stands at 3.48%. These numbers suggest that TJX 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 TJX stands at 1.6 while QD is at 2.2 whereas the debt ratio of the prior is 0.43 while the debt ratio of the later is 0.59.
The values of the both ratios suggest that QD 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 2.1 for TJX and 2.5 for QD which means TJX has Hold rating whereas QD 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 TJX is $114.84 which is 6.17% of its current price while QD has price target of 9.79 which is 55.67% 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.
TJX currently has price to earning P/E ratio of 23.77 whereas QD has 4.38 while the forward P/E ratio for the prior stands at 19.87 and for the later it depicts the value of 2.88.
The price to Book P/B for TJX is 12.86, Price to Sale is at 1.77 and for QD these ratios stand at 0.96 and 1.43.