The shares of Keysight Technologies Inc. (NYSE:KEYS) and CF Industries Holdings, Inc. (NYSE:CF) were among the active stocks of the last trading sessions. Keysight Technologies Inc. (NYSE:KEYS) soared to 0.62% closing at the price of $58.7 whereas the shares of CF Industries Holdings, Inc. (NYSE:CF) soared 4.34% with the increase of 2.15 points closing at the price of $51.64. Keysight Technologies Inc. has currently increase 10.44% in its stock over the period of 6-months while its rival CF Industries Holdings, Inc. added 33.26% 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 Keysight Technologies Inc. (NYSE:KEYS) is 3.7% while the ROI of CF Industries Holdings, Inc. (NYSE:CF) is 3.1%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, KEYS’s EBITDA Margin is 18.39 whereas CF’s is 13.06.
Both the profitability ratios suggest that Keysight Technologies Inc. (NYSE:KEYS) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Keysight Technologies Inc. (NYSE:KEYS) reported $0.89/share EPS for the previous quarter where analysts were predicting an EPS to be $0.79/share Thus beating the analyst Estimates with a Surprise Factor of 12.7 Percent. While, CF Industries Holdings, Inc. (NYSE:CF) reported EPS of $0.13/share in the last quarter. The analysts projected EPS of $0.15/share depicting a Surprise of -13.3 Percent.
Taking a look at Earnings per Share, Keysight Technologies Inc. tends to be beating the analyst estimates more than CF Industries Holdings, Inc.. so KEYS is more profitable than CF.
Technical Analysis of Keysight Technologies Inc. & CF Industries Holdings, Inc.
Moving average convergence divergence (MACD) shows that Keysight Technologies Inc. (NYSE:KEYS) is on a PRICE RELATIVITY trend While CF Industries Holdings, Inc. (NYSE:CF) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Keysight Technologies Inc. was in BEARISH territory and CF Industries Holdings, Inc. was in BULLISH territory.
KEYS’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While CF’s candle is BULLISH with HIGH.
EPS Growth Rate: KEYS’s 16.02% versus CF’s 0%
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 Keysight Technologies Inc. (NYSE:KEYS) is predicted at 16.02% while CF Industries Holdings, Inc. (NYSE:CF) stands at 0%. These numbers suggest that KEYS 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 KEYS stands at 2.4 while CF is at 2 whereas the debt ratio of the prior is 0.69 while the debt ratio of the later is 0.
The values of the both ratios suggest that KEYS is more suitable investment when the liquidity and risk is the main concern.
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 1.4 for KEYS and 2.4 for CF which means KEYS has Buy rating whereas CF 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 KEYS is $74.89 which is 21.62% of its current price while CF has price target of 56.06 which is 7.88% 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.
KEYS currently has price to earning P/E ratio of 0 whereas CF has 56.44 while the forward P/E ratio for the prior stands at 16.14 and for the later it depicts the value of 19.99.
The price to Book P/B for KEYS is 4.22, Price to Sale is at 2.99 and for CF these ratios stand at 3.51 and 2.82.