The shares of Nabors Industries Ltd. (NYSE:NBR) and Invacare Corporation (NYSE:IVC) were among the active stocks of the last trading sessions. Nabors Industries Ltd. (NYSE:NBR) declined to -2.11% closing at the price of $5.56 whereas the shares of Invacare Corporation (NYSE:IVC) declined -43.41% with the decrease of -5.73 points closing at the price of $7.47. Nabors Industries Ltd. has currently decrease -30.76% in its stock over the period of 6-months while its rival Invacare Corporation subtracted -57.31% 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 Nabors Industries Ltd. (NYSE:NBR) is -1.7% while the ROI of Invacare Corporation (NYSE:IVC) is -11.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, NBR’s EBITDA Margin is 8.11 whereas IVC’s is -103.79.
Both the profitability ratios suggest that Nabors Industries Ltd. (NYSE:NBR) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Nabors Industries Ltd. (NYSE:NBR) reported $-0.29/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.2/share Thus lagging the analyst Estimates with a Surprise Factor of -45 Percent. While, Invacare Corporation (NYSE:IVC) reported EPS of $-0.4/share in the last quarter. The analysts projected EPS of $-0.29/share depicting a Surprise of -37.9 Percent.
Taking a look at Earnings per Share, Invacare Corporation tends to be beating the analyst estimates more than Nabors Industries Ltd.. so IVC is more profitable than NBR.
Technical Analysis of Nabors Industries Ltd. & Invacare Corporation
Moving average convergence divergence (MACD) shows that Nabors Industries Ltd. (NYSE:NBR) is on a PRICE RELATIVITY trend While Invacare Corporation (NYSE:IVC) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Nabors Industries Ltd. was in BULLISH territory and Invacare Corporation was in BEARISH territory.
NBR’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While IVC’s candle is BEARISH with HIGH.
EPS Growth Rate: NBR’s 0% versus IVC’s 10%
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 Nabors Industries Ltd. (NYSE:NBR) is predicted at 0% while Invacare Corporation (NYSE:IVC) stands at 10%. These numbers suggest that IVC 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 NBR stands at 2 while IVC is at 2.1 whereas the debt ratio of the prior is 1.25 while the debt ratio of the later is 0.65.
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 NBR and 2.3 for IVC which means NBR has Buy rating whereas IVC 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 NBR is $8.83 which is 37.03% of its current price while IVC has price target of 22 which is 66.05% 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.
NBR currently has price to earning P/E ratio of 0 whereas IVC has 0 while the forward P/E ratio for the prior stands at 0 and for the later it depicts the value of 0.
The price to Book P/B for NBR is 0.6, Price to Sale is at 0.67 and for IVC these ratios stand at 0.64 and 0.25.