The shares of Salesforce.com Inc (NYSE:CRM) and Comstock Mining, Inc. (NYSE:LODE) were among the active stocks of the last trading sessions. Salesforce.com Inc (NYSE:CRM) soared to 1.04% closing at the price of $139.24 whereas the shares of Comstock Mining, Inc. (NYSE:LODE) soared 20.51% with the increase of 0.04 points closing at the price of $0.23. Salesforce.com Inc has currently increase 17% in its stock over the period of 6-months while its rival Comstock Mining, Inc. subtracted -30.6% 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 Salesforce.com Inc (NYSE:CRM) is 2.8% while the ROI of Comstock Mining, Inc. (NYSE:LODE) is 0%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, CRM’s EBITDA Margin is 107.3 whereas LODE’s is -4.88.
Both the profitability ratios suggest that Salesforce.com Inc (NYSE:CRM) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Technical Analysis of Salesforce.com Inc & Comstock Mining, Inc.
Moving average convergence divergence (MACD) shows that Salesforce.com Inc (NYSE:CRM) is on a PRICE RELATIVITY trend While Comstock Mining, Inc. (NYSE:LODE) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Salesforce.com Inc was in BEARISH territory and Comstock Mining, Inc. was in BULLISH territory.
CRM’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While LODE’s candle is BULLISH with HIGH.
EPS Growth Rate: CRM’s 30.7% versus LODE’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 Salesforce.com Inc (NYSE:CRM) is predicted at 30.7% while Comstock Mining, Inc. (NYSE:LODE) stands at 0%. These numbers suggest that CRM 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 CRM stands at 0.8 while LODE is at 4.8 whereas the debt ratio of the prior is 0.33 while the debt ratio of the later is 0.85.
The values of the both ratios suggest that LODE 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 1.7 for CRM and 2 for LODE which means CRM has Buy rating whereas LODE has Buy rating.
Valuation is the process of determining the company’s worth for an investor, the valuation ratios give an insight to that worthiness.
CRM currently has price to earning P/E ratio of 108.87 whereas LODE has 0 while the forward P/E ratio for the prior stands at 51.02 and for the later it depicts the value of 0.
The price to Book P/B for CRM is 7.69, Price to Sale is at 8.91 and for LODE these ratios stand at 1.17 and 140.11.