The shares of Universal Display Corporation (NASDAQ:OLED) and Iamgold Corporation (NYSE:IAG) were among the active stocks of the last trading sessions. Universal Display Corporation (NASDAQ:OLED) declined to -20.51% closing at the price of $103.06 whereas the shares of Iamgold Corporation (NYSE:IAG) soared 1.38% with the increase of 0.05 points closing at the price of $3.68. Universal Display Corporation has currently increase 7.97% in its stock over the period of 6-months while its rival Iamgold Corporation subtracted -35.33% 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 Universal Display Corporation (NASDAQ:OLED) is 17% while the ROI of Iamgold Corporation (NYSE:IAG) is 14.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, OLED’s EBITDA Margin is 40.39 whereas IAG’s is 4.23.
Both the profitability ratios suggest that Universal Display Corporation (NASDAQ:OLED) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Universal Display Corporation (NASDAQ:OLED) reported $0.48/share EPS for the previous quarter where analysts were predicting an EPS to be $0.66/share Thus lagging the analyst Estimates with a Surprise Factor of -27.3 Percent. While, Iamgold Corporation (NYSE:IAG) reported EPS of $-0.03/share in the last quarter. The analysts projected EPS of $0.02/share depicting a Surprise of -250 Percent.
Taking a look at Earnings per Share, Universal Display Corporation tends to be beating the analyst estimates more than Iamgold Corporation. so OLED is more profitable than IAG.
Technical Analysis of Universal Display Corporation & Iamgold Corporation
Moving average convergence divergence (MACD) shows that Universal Display Corporation (NASDAQ:OLED) is on a PRICE RELATIVITY trend While Iamgold Corporation (NYSE:IAG) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Universal Display Corporation was in BULLISH territory and Iamgold Corporation was in BEARISH territory.
OLED’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While IAG’s candle is BULLISH with HIGH.
EPS Growth Rate: OLED’s 29.08% versus IAG’s -7.42%
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 Universal Display Corporation (NASDAQ:OLED) is predicted at 29.08% while Iamgold Corporation (NYSE:IAG) stands at -7.42%. These numbers suggest that OLED 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 OLED stands at 5.4 while IAG is at 4.7 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 0.14.
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 OLED and 2.2 for IAG which means OLED has Buy rating whereas IAG 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 OLED is $147.82 which is 30.28% of its current price while IAG has price target of 7.65 which is 51.9% 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.
OLED currently has price to earning P/E ratio of 65.52 whereas IAG has 60.33 while the forward P/E ratio for the prior stands at 36.75 and for the later it depicts the value of 30.16.
The price to Book P/B for OLED is 7.15, Price to Sale is at 22.02 and for IAG these ratios stand at 0.61 and 1.49.