The shares of Marvell Technology Group Ltd. (NASDAQ:MRVL) and Barrick Gold Corporation (NYSE:ABX) were among the active stocks of the last trading sessions. Marvell Technology Group Ltd. (NASDAQ:MRVL) declined to -1.63% closing at the price of $16.86 whereas the shares of Barrick Gold Corporation (NYSE:ABX) declined -0.53% with the decrease of -0.07 points closing at the price of $13.14. Marvell Technology Group Ltd. has currently decrease -20.81% in its stock over the period of 6-months while its rival Barrick Gold Corporation subtracted -1.35% 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 Marvell Technology Group Ltd. (NASDAQ:MRVL) is 10.1% while the ROI of Barrick Gold Corporation (NYSE:ABX) is 11.1%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, MRVL’s EBITDA Margin is 21.27 whereas ABX’s is 6.12.
Both the profitability ratios suggest a mixed sentiment for Marvell Technology Group Ltd. (NASDAQ:MRVL) and Barrick Gold Corporation (NYSE:ABX).
EPS & Surprise Factor
Marvell Technology Group Ltd. (NASDAQ:MRVL) reported $0.28/share EPS for the previous quarter where analysts were predicting an EPS to be $0.35/share Thus lagging the analyst Estimates with a Surprise Factor of -20 Percent. While, Barrick Gold Corporation (NYSE:ABX) reported EPS of $0.08/share in the last quarter. The analysts projected EPS of $0.05/share depicting a Surprise of 60 Percent.
Taking a look at Earnings per Share, Barrick Gold Corporation tends to be beating the analyst estimates more than Marvell Technology Group Ltd.. so ABX is more profitable than MRVL.
Technical Analysis of Marvell Technology Group Ltd. & Barrick Gold Corporation
Moving average convergence divergence (MACD) shows that Marvell Technology Group Ltd. (NASDAQ:MRVL) is on a PRICE RELATIVITY trend While Barrick Gold Corporation (NYSE:ABX) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Marvell Technology Group Ltd. was in BULLISH territory and Barrick Gold Corporation was in BULLISH territory.
MRVL’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While ABX’s candle is BEARISH with MEDIUM.
EPS Growth Rate: MRVL’s 14.1% versus ABX’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 Marvell Technology Group Ltd. (NASDAQ:MRVL) is predicted at 14.1% while Barrick Gold Corporation (NYSE:ABX) stands at 0%. These numbers suggest that MRVL 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 MRVL stands at 2.5 while ABX is at 2.6 whereas the debt ratio of the prior is 0.25 while the debt ratio of the later is 0.64.
The values of the both ratios suggest that ABX 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 1.9 for MRVL and 2.8 for ABX which means MRVL has Buy rating whereas ABX 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 MRVL is $26.52 which is 36.43% of its current price while ABX has price target of 13.82 which is 4.92% 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.
MRVL currently has price to earning P/E ratio of 25.66 whereas ABX has 0 while the forward P/E ratio for the prior stands at 11.04 and for the later it depicts the value of 28.14.
The price to Book P/B for MRVL is 1.21, Price to Sale is at 4.43 and for ABX these ratios stand at 1.72 and 2.06.