The shares of ICICI Bank Limited (NYSE:IBN) and SRC Energy Inc. (NYSE:SRCI) were among the active stocks of the last trading sessions. ICICI Bank Limited (NYSE:IBN) soared to 0.95% closing at the price of $9.61 whereas the shares of SRC Energy Inc. (NYSE:SRCI) declined -4.17% with the decrease of -0.32 points closing at the price of $7.35. ICICI Bank Limited has currently increase 6.31% in its stock over the period of 6-months while its rival SRC Energy Inc. subtracted -38.18% 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 ICICI Bank Limited (NYSE:IBN) is 3% while the ROI of SRC Energy Inc. (NYSE:SRCI) is 7.9%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, IBN’s EBITDA Margin is NOT AVAILABLE whereas SRCI’s is 6.32.
Both the profitability ratios suggest a mixed sentiment for ICICI Bank Limited (NYSE:IBN) and SRC Energy Inc. (NYSE:SRCI).
EPS & Surprise Factor
ICICI Bank Limited (NYSE:IBN) reported $0.06/share EPS for the previous quarter where analysts were predicting an EPS to be $0.09/share Thus lagging the analyst Estimates with a Surprise Factor of -33.3 Percent. While, SRC Energy Inc. (NYSE:SRCI) reported EPS of $0.26/share in the last quarter. The analysts projected EPS of $0.25/share depicting a Surprise of 4 Percent.
Taking a look at Earnings per Share, SRC Energy Inc. tends to be beating the analyst estimates more than ICICI Bank Limited. so SRCI is more profitable than IBN.
Technical Analysis of ICICI Bank Limited & SRC Energy Inc.
Moving average convergence divergence (MACD) shows that ICICI Bank Limited (NYSE:IBN) is on a PRICE RELATIVITY trend While SRC Energy Inc. (NYSE:SRCI) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the ICICI Bank Limited was in BULLISH territory and SRC Energy Inc. was in BULLISH territory.
IBN’s current statistics gauge that the stock candle is NEUTRAL with HIGH volatility. While SRCI’s candle is BEARISH with HIGH.
EPS Growth Rate: IBN’s 22% versus SRCI’s 34.79%
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 ICICI Bank Limited (NYSE:IBN) is predicted at 22% while SRC Energy Inc. (NYSE:SRCI) stands at 34.79%. These numbers suggest that SRCI 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 IBN stands at 0 while SRCI is at 0.5 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 0.44.
The values of the both ratios suggest that SRCI 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 2 for IBN and 2.1 for SRCI which means IBN has Buy rating whereas SRCI 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 IBN is $13.5 which is 28.81% of its current price while SRCI has price target of 13.69 which is 46.31% 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.
IBN currently has price to earning P/E ratio of 36.4 whereas SRCI has 7.67 while the forward P/E ratio for the prior stands at 13.26 and for the later it depicts the value of 4.87.
The price to Book P/B for IBN is 0, Price to Sale is at 7.58 and for SRCI these ratios stand at 1.19 and 3.06.