The shares of Patterson-UTI Energy, Inc. (NASDAQ:PTEN) and Novo Nordisk A/S (NYSE:NVO) were among the active stocks of the last trading sessions. Patterson-UTI Energy, Inc. (NASDAQ:PTEN) declined to -1.55% closing at the price of $16.49 whereas the shares of Novo Nordisk A/S (NYSE:NVO) declined -0.46% with the decrease of -0.19 points closing at the price of $41.54. Patterson-UTI Energy, Inc. has currently decrease -17.59% in its stock over the period of 6-months while its rival Novo Nordisk A/S subtracted -15.48% 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 Patterson-UTI Energy, Inc. (NASDAQ:PTEN) is -3.7% while the ROI of Novo Nordisk A/S (NYSE:NVO) is 74.6%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, PTEN’s EBITDA Margin is 6.52 whereas NVO’s is 13.38.
Both the profitability ratios suggest that Novo Nordisk A/S (NYSE:NVO) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Patterson-UTI Energy, Inc. (NASDAQ:PTEN) reported $-0.05/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.04/share Thus lagging the analyst Estimates with a Surprise Factor of -25 Percent. While, Novo Nordisk A/S (NYSE:NVO) reported EPS of $0.68/share in the last quarter. The analysts projected EPS of $0.65/share depicting a Surprise of 4.6 Percent.
Taking a look at Earnings per Share, Novo Nordisk A/S tends to be beating the analyst estimates more than Patterson-UTI Energy, Inc.. so NVO is more profitable than PTEN.
Technical Analysis of Patterson-UTI Energy, Inc. & Novo Nordisk A/S
Moving average convergence divergence (MACD) shows that Patterson-UTI Energy, Inc. (NASDAQ:PTEN) is on a PRICE RELATIVITY trend While Novo Nordisk A/S (NYSE:NVO) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Patterson-UTI Energy, Inc. was in BEARISH territory and Novo Nordisk A/S was in BEARISH territory.
PTEN’s current statistics gauge that the stock candle is BULLISH with MEDIUM volatility. While NVO’s candle is BEARISH with HIGH.
EPS Growth Rate: PTEN’s 22.6% versus NVO’s 8%
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 Patterson-UTI Energy, Inc. (NASDAQ:PTEN) is predicted at 22.6% while Novo Nordisk A/S (NYSE:NVO) stands at 8%. These numbers suggest that PTEN 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 PTEN stands at 1.7 while NVO is at 1.2 whereas the debt ratio of the prior is 0.29 while the debt ratio of the later is 0.01.
The values of the both ratios suggest that PTEN 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 PTEN and 1 for NVO which means PTEN has Buy rating whereas NVO has Strong 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 PTEN is $22.18 which is 25.65% of its current price while NVO has price target of 59.41 which is 30.08% 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.
PTEN currently has price to earning P/E ratio of 0 whereas NVO has 16.85 while the forward P/E ratio for the prior stands at 0 and for the later it depicts the value of 16.29.
The price to Book P/B for PTEN is 0.94, Price to Sale is at 1.15 and for NVO these ratios stand at 13.31 and 4.66.