The shares of Amkor Technology, Inc. (NASDAQ:AMKR) and Costco Wholesale Corporation (NASDAQ:COST) were among the active stocks of the last trading sessions. Amkor Technology, Inc. (NASDAQ:AMKR) declined to -6.55% closing at the price of $6.28 whereas the shares of Costco Wholesale Corporation (NASDAQ:COST) soared 0.04% with the increase of 0.09 points closing at the price of $228.58. Amkor Technology, Inc. has currently decrease -35.46% in its stock over the period of 6-months while its rival Costco Wholesale Corporation added 18.09% 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 Amkor Technology, Inc. (NASDAQ:AMKR) is 10.3% while the ROI of Costco Wholesale Corporation (NASDAQ:COST) is 16%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, AMKR’s EBITDA Margin is 2.93 whereas COST’s is 17.12.
Both the profitability ratios suggest that Costco Wholesale Corporation (NASDAQ:COST) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Amkor Technology, Inc. (NASDAQ:AMKR) reported $0.14/share EPS for the previous quarter where analysts were predicting an EPS to be $0.05/share Thus beating the analyst Estimates with a Surprise Factor of 180 Percent. While, Costco Wholesale Corporation (NASDAQ:COST) reported EPS of $2.36/share in the last quarter. The analysts projected EPS of $2.36/share depicting a Surprise of 0 Percent.
Taking a look at Earnings per Share, Amkor Technology, Inc. tends to be beating the analyst estimates more than Costco Wholesale Corporation. so AMKR is more profitable than COST.
Technical Analysis of Amkor Technology, Inc. & Costco Wholesale Corporation
Moving average convergence divergence (MACD) shows that Amkor Technology, Inc. (NASDAQ:AMKR) is on a PRICE RELATIVITY trend While Costco Wholesale Corporation (NASDAQ:COST) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Amkor Technology, Inc. was in BEARISH territory and Costco Wholesale Corporation was in BULLISH territory.
AMKR’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While COST’s candle is BEARISH with MEDIUM.
EPS Growth Rate: AMKR’s 10.17% versus COST’s 11.22%
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 Amkor Technology, Inc. (NASDAQ:AMKR) is predicted at 10.17% while Costco Wholesale Corporation (NASDAQ:COST) stands at 11.22%. These numbers suggest that COST 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 AMKR stands at 1.3 while COST is at 1 whereas the debt ratio of the prior is 0.76 while the debt ratio of the later is 0.
The values of the both ratios suggest that AMKR 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 3.3 for AMKR and 2.2 for COST which means AMKR has Sell rating whereas COST 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 AMKR is $9.67 which is 35.06% of its current price while COST has price target of 241.58 which is 5.38% 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.
AMKR currently has price to earning P/E ratio of 9.66 whereas COST has 33.61 while the forward P/E ratio for the prior stands at 7.66 and for the later it depicts the value of 27.17.
The price to Book P/B for AMKR is 0.86, Price to Sale is at 0.34 and for COST these ratios stand at 8.26 and 0.71.