The shares of Citrix Systems, Inc. (NASDAQ:CTXS) and Hormel Foods Corporation (NYSE:HRL) were among the active stocks of the last trading sessions. Citrix Systems, Inc. (NASDAQ:CTXS) declined to -1.62% closing at the price of $103.42 whereas the shares of Hormel Foods Corporation (NYSE:HRL) soared 0.54% with the increase of 0.22 points closing at the price of $41.12. Citrix Systems, Inc. has currently increase 7.09% in its stock over the period of 6-months while its rival Hormel Foods Corporation added 15.99% 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 Citrix Systems, Inc. (NASDAQ:CTXS) is 15.2% while the ROI of Hormel Foods Corporation (NYSE:HRL) is 16.4%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, CTXS’s EBITDA Margin is 16.46 whereas HRL’s is 17.24.
Both the profitability ratios suggest that Hormel Foods Corporation (NYSE:HRL) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Citrix Systems, Inc. (NASDAQ:CTXS) reported $1.28/share EPS for the previous quarter where analysts were predicting an EPS to be $1.2/share Thus beating the analyst Estimates with a Surprise Factor of 6.7 Percent. While, Hormel Foods Corporation (NYSE:HRL) reported EPS of $0.39/share in the last quarter. The analysts projected EPS of $0.39/share depicting a Surprise of 0 Percent.
Taking a look at Earnings per Share, Citrix Systems, Inc. tends to be beating the analyst estimates more than Hormel Foods Corporation. so CTXS is more profitable than HRL.
Technical Analysis of Citrix Systems, Inc. & Hormel Foods Corporation
Moving average convergence divergence (MACD) shows that Citrix Systems, Inc. (NASDAQ:CTXS) is on a PRICE RELATIVITY trend While Hormel Foods Corporation (NYSE:HRL) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Citrix Systems, Inc. was in BEARISH territory and Hormel Foods Corporation was in BULLISH territory.
CTXS’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While HRL’s candle is BULLISH with MEDIUM.
EPS Growth Rate: CTXS’s 11.2% versus HRL’s 10.5%
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 Citrix Systems, Inc. (NASDAQ:CTXS) is predicted at 11.2% while Hormel Foods Corporation (NYSE:HRL) stands at 10.5%. These numbers suggest that CTXS 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 CTXS stands at 0.8 while HRL is at 1.7 whereas the debt ratio of the prior is 3.42 while the debt ratio of the later is 0.13.
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 2.8 for CTXS and 2.8 for HRL which means CTXS has Hold rating whereas HRL 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 CTXS is $115.12 which is 10.16% of its current price while HRL has price target of 36.92 which is -11.38% 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.
CTXS currently has price to earning P/E ratio of 29.33 whereas HRL has 24.76 while the forward P/E ratio for the prior stands at 17.36 and for the later it depicts the value of 22.34.
The price to Book P/B for CTXS is 22.1, Price to Sale is at 4.8 and for HRL these ratios stand at 4.05 and 2.3.