The shares of State Street Corporation (NYSE:STT) and SolarEdge Technologies, Inc. (NASDAQ:SEDG) were among the active stocks of the last trading sessions. State Street Corporation (NYSE:STT) soared to 0.03% closing at the price of $69.98 whereas the shares of SolarEdge Technologies, Inc. (NASDAQ:SEDG) declined -7.99% with the decrease of -3.28 points closing at the price of $37.75. State Street Corporation has currently decrease -28.95% in its stock over the period of 6-months while its rival SolarEdge Technologies, Inc. subtracted -33.71% 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 State Street Corporation (NYSE:STT) is 5.2% while the ROI of SolarEdge Technologies, Inc. (NASDAQ:SEDG) is 23.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, STT’s EBITDA Margin is NOT AVAILABLE whereas SEDG’s is 9.72.
Both the profitability ratios suggest a mixed sentiment for State Street Corporation (NYSE:STT) and SolarEdge Technologies, Inc. (NASDAQ:SEDG).
EPS & Surprise Factor
State Street Corporation (NYSE:STT) reported $1.87/share EPS for the previous quarter where analysts were predicting an EPS to be $1.89/share Thus lagging the analyst Estimates with a Surprise Factor of -1.1 Percent. While, SolarEdge Technologies, Inc. (NASDAQ:SEDG) reported EPS of $0.86/share in the last quarter. The analysts projected EPS of $0.82/share depicting a Surprise of 4.9 Percent.
Taking a look at Earnings per Share, SolarEdge Technologies, Inc. tends to be beating the analyst estimates more than State Street Corporation. so SEDG is more profitable than STT.
Technical Analysis of State Street Corporation & SolarEdge Technologies, Inc.
Moving average convergence divergence (MACD) shows that State Street Corporation (NYSE:STT) is on a PRICE RELATIVITY trend While SolarEdge Technologies, Inc. (NASDAQ:SEDG) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the State Street Corporation was in BULLISH territory and SolarEdge Technologies, Inc. was in BEARISH territory.
STT’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While SEDG’s candle is BEARISH with HIGH.
EPS Growth Rate: STT’s 9.75% versus SEDG’s 20%
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 State Street Corporation (NYSE:STT) is predicted at 9.75% while SolarEdge Technologies, Inc. (NASDAQ:SEDG) stands at 20%. These numbers suggest that SEDG 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 STT stands at 0 while SEDG is at 4 whereas the debt ratio of the prior is 0.62 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 2.3 for STT and 2.1 for SEDG which means STT has Hold rating whereas SEDG 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 STT is $91.5 which is 23.52% of its current price while SEDG has price target of 57.5 which is 34.35% 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.
STT currently has price to earning P/E ratio of 10.07 whereas SEDG has 13 while the forward P/E ratio for the prior stands at 9.06 and for the later it depicts the value of 11.43.
The price to Book P/B for STT is 1.26, Price to Sale is at 7.62 and for SEDG these ratios stand at 3.52 and 2.35.