The shares of MINDBODY, Inc. (NASDAQ:MB) and Royal Caribbean Cruises Ltd. (NYSE:RCL) were among the active stocks of the last trading sessions. MINDBODY, Inc. (NASDAQ:MB) soared to 3.13% closing at the price of $27 whereas the shares of Royal Caribbean Cruises Ltd. (NYSE:RCL) declined -1.23% with the decrease of -1.34 points closing at the price of $107.69. MINDBODY, Inc. has currently decrease -29.69% in its stock over the period of 6-months while its rival Royal Caribbean Cruises Ltd. added 0.59% 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 MINDBODY, Inc. (NASDAQ:MB) is -5.1% while the ROI of Royal Caribbean Cruises Ltd. (NYSE:RCL) is 9.7%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, MB’s EBITDA Margin is -126.99 whereas RCL’s is 11.74.
Both the profitability ratios suggest that Royal Caribbean Cruises Ltd. (NYSE:RCL) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
MINDBODY, Inc. (NASDAQ:MB) reported $-0.05/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.07/share Thus beating the analyst Estimates with a Surprise Factor of 28.6 Percent. While, Royal Caribbean Cruises Ltd. (NYSE:RCL) reported EPS of $3.98/share in the last quarter. The analysts projected EPS of $3.97/share depicting a Surprise of 0.3 Percent.
Taking a look at Earnings per Share, MINDBODY, Inc. tends to be beating the analyst estimates more than Royal Caribbean Cruises Ltd.. so MB is more profitable than RCL.
Technical Analysis of MINDBODY, Inc. & Royal Caribbean Cruises Ltd.
Moving average convergence divergence (MACD) shows that MINDBODY, Inc. (NASDAQ:MB) is on a PRICE RELATIVITY trend While Royal Caribbean Cruises Ltd. (NYSE:RCL) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the MINDBODY, Inc. was in BEARISH territory and Royal Caribbean Cruises Ltd. was in BULLISH territory.
MB’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While RCL’s candle is BEARISH with HIGH.
EPS Growth Rate: MB’s 25% versus RCL’s 12%
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 MINDBODY, Inc. (NASDAQ:MB) is predicted at 25% while Royal Caribbean Cruises Ltd. (NYSE:RCL) stands at 12%. These numbers suggest that MB 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 MB stands at 9.6 while RCL is at 0.2 whereas the debt ratio of the prior is 0.86 while the debt ratio of the later is 0.87.
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 2.1 for MB and 1.7 for RCL which means MB has Hold rating whereas RCL 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 MB is $44.77 which is 39.69% of its current price while RCL has price target of 137.53 which is 21.7% 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.
MB currently has price to earning P/E ratio of 0 whereas RCL has 12.79 while the forward P/E ratio for the prior stands at 500 and for the later it depicts the value of 10.9.
The price to Book P/B for MB is 4.47, Price to Sale is at 6.08 and for RCL these ratios stand at 1.99 and 2.52.