The shares of Brighthouse Financial, Inc. (NASDAQ:BHF) and ServiceMaster Global Holdings, Inc. (NYSE:SERV) were among the active stocks of the last trading sessions. Brighthouse Financial, Inc. (NASDAQ:BHF) soared to 3.33% closing at the price of $44.03 whereas the shares of ServiceMaster Global Holdings, Inc. (NYSE:SERV) declined -1.23% with the decrease of -0.52 points closing at the price of $41.74. Brighthouse Financial, Inc. has currently decrease -10.16% in its stock over the period of 6-months while its rival ServiceMaster Global Holdings, Inc. added 11.29% 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 Brighthouse Financial, Inc. (NASDAQ:BHF) is -5.2% while the ROI of ServiceMaster Global Holdings, Inc. (NYSE:SERV) is 9.8%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, BHF’s EBITDA Margin is -16.81 whereas SERV’s is 12.19.
Both the profitability ratios suggest that ServiceMaster Global Holdings, Inc. (NYSE:SERV) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Brighthouse Financial, Inc. (NASDAQ:BHF) reported $2.23/share EPS for the previous quarter where analysts were predicting an EPS to be $2.06/share Thus beating the analyst Estimates with a Surprise Factor of 8.3 Percent. While, ServiceMaster Global Holdings, Inc. (NYSE:SERV) reported EPS of $0.67/share in the last quarter. The analysts projected EPS of $0.77/share depicting a Surprise of -13 Percent.
Taking a look at Earnings per Share, Brighthouse Financial, Inc. tends to be beating the analyst estimates more than ServiceMaster Global Holdings, Inc.. so BHF is more profitable than SERV.
Technical Analysis of Brighthouse Financial, Inc. & ServiceMaster Global Holdings, Inc.
Moving average convergence divergence (MACD) shows that Brighthouse Financial, Inc. (NASDAQ:BHF) is on a PRICE RELATIVITY trend While ServiceMaster Global Holdings, Inc. (NYSE:SERV) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Brighthouse Financial, Inc. was in BULLISH territory and ServiceMaster Global Holdings, Inc. was in BULLISH territory.
BHF’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While SERV’s candle is BEARISH with HIGH.
EPS Growth Rate: BHF’s 4.57% versus SERV’s 10.3%
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 Brighthouse Financial, Inc. (NASDAQ:BHF) is predicted at 4.57% while ServiceMaster Global Holdings, Inc. (NYSE:SERV) stands at 10.3%. These numbers suggest that SERV 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 BHF stands at 0 while SERV is at 1 whereas the debt ratio of the prior is 0.27 while the debt ratio of the later is 2.03.
The values of the both ratios suggest that SERV 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 3 for BHF and 1.8 for SERV which means BHF has Hold rating whereas SERV has Buy 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 BHF is $48.43 which is 9.09% of its current price while SERV has price target of 46.33 which is 9.91% 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.
BHF currently has price to earning P/E ratio of 0 whereas SERV has 22.36 while the forward P/E ratio for the prior stands at 4.85 and for the later it depicts the value of 26.01.
The price to Book P/B for BHF is 0.39, Price to Sale is at 0.72 and for SERV these ratios stand at 4.2 and 1.88.