The shares of Golar LNG Limited (NASDAQ:GLNG) and Fluor Corporation (NYSE:FLR) were among the active stocks of the last trading sessions. Golar LNG Limited (NASDAQ:GLNG) declined to -1.54% closing at the price of $27.52 whereas the shares of Fluor Corporation (NYSE:FLR) soared 0.11% with the increase of 0.05 points closing at the price of $46.79. Golar LNG Limited has currently decrease -15.04% in its stock over the period of 6-months while its rival Fluor Corporation subtracted -20.13% 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 Golar LNG Limited (NASDAQ:GLNG) is -2.1% while the ROI of Fluor Corporation (NYSE:FLR) is 6.9%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, GLNG’s EBITDA Margin is 573.85 whereas FLR’s is 8.5.
Both the profitability ratios suggest a mixed sentiment for Golar LNG Limited (NASDAQ:GLNG) and Fluor Corporation (NYSE:FLR).
EPS & Surprise Factor
Golar LNG Limited (NASDAQ:GLNG) reported $-0.63/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.19/share Thus lagging the analyst Estimates with a Surprise Factor of -231.6 Percent. While, Fluor Corporation (NYSE:FLR) reported EPS of $0.81/share in the last quarter. The analysts projected EPS of $0.71/share depicting a Surprise of 14.1 Percent.
Taking a look at Earnings per Share, Fluor Corporation tends to be beating the analyst estimates more than Golar LNG Limited. so FLR is more profitable than GLNG.
Technical Analysis of Golar LNG Limited & Fluor Corporation
Moving average convergence divergence (MACD) shows that Golar LNG Limited (NASDAQ:GLNG) is on a PRICE RELATIVITY trend While Fluor Corporation (NYSE:FLR) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Golar LNG Limited was in BULLISH territory and Fluor Corporation was in BEARISH territory.
GLNG’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While FLR’s candle is BEARISH with HIGH.
EPS Growth Rate: GLNG’s 0% versus FLR’s 44.3%
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 Golar LNG Limited (NASDAQ:GLNG) is predicted at 0% while Fluor Corporation (NYSE:FLR) stands at 44.3%. These numbers suggest that FLR 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 GLNG stands at 0.6 while FLR is at 1.5 whereas the debt ratio of the prior is 1.6 while the debt ratio of the later is 0.54.
The values of the both ratios suggest that one is more liquid and other investment is more risk free.
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 1.8 for GLNG and 2.4 for FLR which means GLNG has Buy rating whereas FLR 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 GLNG is $36.63 which is 24.87% of its current price while FLR has price target of 60.71 which is 22.93% 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.
GLNG currently has price to earning P/E ratio of 0 whereas FLR has 20.12 while the forward P/E ratio for the prior stands at 120.17 and for the later it depicts the value of 14.43.
The price to Book P/B for GLNG is 1.63, Price to Sale is at 12.57 and for FLR these ratios stand at 2.16 and 0.33.