The shares of Century Aluminum Company (NASDAQ:CENX) and Marriott International (NASDAQ:MAR) were among the active stocks of the last trading sessions. Century Aluminum Company (NASDAQ:CENX) soared to 10.07% closing at the price of $9.73 whereas the shares of Marriott International (NASDAQ:MAR) declined -0.13% with the decrease of -0.16 points closing at the price of $120.93. Century Aluminum Company has currently decrease -35.13% in its stock over the period of 6-months while its rival Marriott International subtracted -11.5% 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 Century Aluminum Company (NASDAQ:CENX) is 7.3% while the ROI of Marriott International (NASDAQ:MAR) is 12.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, CENX’s EBITDA Margin is 5.61 whereas MAR’s is 16.69.
Both the profitability ratios suggest that Marriott International (NASDAQ:MAR) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Technical Analysis of Century Aluminum Company & Marriott International
Moving average convergence divergence (MACD) shows that Century Aluminum Company (NASDAQ:CENX) is on a PRICE RELATIVITY trend While Marriott International (NASDAQ:MAR) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Century Aluminum Company was in BEARISH territory and Marriott International was in BULLISH territory.
CENX’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While MAR’s candle is BEARISH with HIGH.
EPS Growth Rate: CENX’s 0% versus MAR’s 18.32%
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 Century Aluminum Company (NASDAQ:CENX) is predicted at 0% while Marriott International (NASDAQ:MAR) stands at 18.32%. These numbers suggest that MAR 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 CENX stands at 2.9 while MAR is at 0.5 whereas the debt ratio of the prior is 0.3 while the debt ratio of the later is 3.16.
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 CENX and 2.3 for MAR which means CENX has Hold rating whereas MAR 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 CENX is $14.33 which is 32.1% of its current price while MAR has price target of 143.95 which is 15.99% 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.
CENX currently has price to earning P/E ratio of 26.73 whereas MAR has 20.05 while the forward P/E ratio for the prior stands at 20.02 and for the later it depicts the value of 18.91.
The price to Book P/B for CENX is 1, Price to Sale is at 0.42 and for MAR these ratios stand at 15.04 and 1.92.