The shares of EOG Resources, Inc. (NYSE:EOG) and Boeing Company (The) (NYSE:BA) were among the active stocks of the last trading sessions. EOG Resources, Inc. (NYSE:EOG) soared to 1.47% closing at the price of $106.89 whereas the shares of Boeing Company (The) (NYSE:BA) soared 2.31% with the increase of 8.21 points closing at the price of $363.07. EOG Resources, Inc. has currently decrease -6.78% in its stock over the period of 6-months while its rival Boeing Company (The) added 8.56% 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 EOG Resources, Inc. (NYSE:EOG) is 2.9% while the ROI of Boeing Company (The) (NYSE:BA) is 52.3%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, EOG’s EBITDA Margin is 11.12 whereas BA’s is 15.59.
Both the profitability ratios suggest that Boeing Company (The) (NYSE:BA) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
EOG Resources, Inc. (NYSE:EOG) reported $1.75/share EPS for the previous quarter where analysts were predicting an EPS to be $1.52/share Thus beating the analyst Estimates with a Surprise Factor of 15.1 Percent. While, Boeing Company (The) (NYSE:BA) reported EPS of $3.58/share in the last quarter. The analysts projected EPS of $3.47/share depicting a Surprise of 3.2 Percent.
Taking a look at Earnings per Share, EOG Resources, Inc. tends to be beating the analyst estimates more than Boeing Company (The). so EOG is more profitable than BA.
Technical Analysis of EOG Resources, Inc. & Boeing Company (The)
Moving average convergence divergence (MACD) shows that EOG Resources, Inc. (NYSE:EOG) is on a PRICE RELATIVITY trend While Boeing Company (The) (NYSE:BA) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the EOG Resources, Inc. was in BEARISH territory and Boeing Company (The) was in BULLISH territory.
EOG’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While BA’s candle is BULLISH with HIGH.
EPS Growth Rate: EOG’s 0% versus BA’s 21.17%
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 EOG Resources, Inc. (NYSE:EOG) is predicted at 0% while Boeing Company (The) (NYSE:BA) stands at 21.17%. These numbers suggest that BA 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 EOG stands at 1 while BA is at 1.1 whereas the debt ratio of the prior is 0.37 while the debt ratio of the later is 0.
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 for EOG and 2 for BA which means EOG has Buy rating whereas BA has 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 EOG is $145.25 which is 26.41% of its current price while BA has price target of 414.87 which is 12.49% 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.
EOG currently has price to earning P/E ratio of 37.19 whereas BA has 23.59 while the forward P/E ratio for the prior stands at 13.99 and for the later it depicts the value of 19.95.
The price to Book P/B for EOG is 3.53, Price to Sale is at 4.45 and for BA these ratios stand at 0 and 2.13.