The shares of Investors Bancorp, Inc. (NASDAQ:ISBC) and CVS Health Corporation (NYSE:CVS) were among the active stocks of the last trading sessions. Investors Bancorp, Inc. (NASDAQ:ISBC) soared to 9.93% closing at the price of $12.51 whereas the shares of CVS Health Corporation (NYSE:CVS) soared 5.71% with the increase of 4.21 points closing at the price of $77.9. Investors Bancorp, Inc. has currently decrease -7.68% in its stock over the period of 6-months while its rival CVS Health Corporation added 27.27% 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 Investors Bancorp, Inc. (NASDAQ:ISBC) is 17.9% while the ROI of CVS Health Corporation (NYSE:CVS) is 9.9%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, ISBC’s EBITDA Margin is NOT AVAILABLE whereas CVS’s is 7.45.
Both the profitability ratios suggest that Investors Bancorp, Inc. (NASDAQ:ISBC) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Investors Bancorp, Inc. (NASDAQ:ISBC) reported $0.19/share EPS for the previous quarter where analysts were predicting an EPS to be $0.19/share Thus meeting the analyst Estimates with a Surprise Factor of 0 Percent. While, CVS Health Corporation (NYSE:CVS) reported EPS of $1.73/share in the last quarter. The analysts projected EPS of $1.71/share depicting a Surprise of 1.2 Percent.
Taking a look at Earnings per Share, CVS Health Corporation tends to be beating the analyst estimates more than Investors Bancorp, Inc.. so CVS is more profitable than ISBC.
Technical Analysis of Investors Bancorp, Inc. & CVS Health Corporation
Moving average convergence divergence (MACD) shows that Investors Bancorp, Inc. (NASDAQ:ISBC) is on a PRICE RELATIVITY trend While CVS Health Corporation (NYSE:CVS) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Investors Bancorp, Inc. was in BULLISH territory and CVS Health Corporation was in BULLISH territory.
ISBC’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While CVS’s candle is BULLISH with HIGH.
EPS Growth Rate: ISBC’s 12% versus CVS’s 10.18%
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 Investors Bancorp, Inc. (NASDAQ:ISBC) is predicted at 12% while CVS Health Corporation (NYSE:CVS) stands at 10.18%. These numbers suggest that ISBC 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 ISBC stands at 0 while CVS is at 2.3 whereas the debt ratio of the prior is 1.66 while the debt ratio of the later is 1.83.
The values of the both ratios suggest that CVS 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 2.6 for ISBC and 1.9 for CVS which means ISBC has Hold rating whereas CVS 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 ISBC is $13.25 which is 5.58% of its current price while CVS has price target of 88.45 which is 11.93% 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.
ISBC currently has price to earning P/E ratio of 16.75 whereas CVS has 53.32 while the forward P/E ratio for the prior stands at 16.29 and for the later it depicts the value of 10.64.
The price to Book P/B for ISBC is 1.15, Price to Sale is at 3.93 and for CVS these ratios stand at 2.23 and 0.43.