The shares of Dean Foods Company (NYSE:DF) and Astrazeneca PLC (NYSE:AZN) were among the active stocks of the last trading sessions. Dean Foods Company (NYSE:DF) declined to -0.5% closing at the price of $5.97 whereas the shares of Astrazeneca PLC (NYSE:AZN) soared 3.67% with the increase of 1.44 points closing at the price of $40.65. Dean Foods Company has currently decrease -42.98% in its stock over the period of 6-months while its rival Astrazeneca PLC added 11.68% 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 Dean Foods Company (NYSE:DF) is 4.2% while the ROI of Astrazeneca PLC (NYSE:AZN) is 13.3%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, DF’s EBITDA Margin is 5.51 whereas AZN’s is 26.33.
Both the profitability ratios suggest that Astrazeneca PLC (NYSE:AZN) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Dean Foods Company (NYSE:DF) reported $-0.28/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.06/share Thus lagging the analyst Estimates with a Surprise Factor of -366.7 Percent. While, Astrazeneca PLC (NYSE:AZN) reported EPS of $0.35/share in the last quarter. The analysts projected EPS of $0.3/share depicting a Surprise of 16.7 Percent.
Taking a look at Earnings per Share, Astrazeneca PLC tends to be beating the analyst estimates more than Dean Foods Company. so AZN is more profitable than DF.
Technical Analysis of Dean Foods Company & Astrazeneca PLC
Moving average convergence divergence (MACD) shows that Dean Foods Company (NYSE:DF) is on a PRICE RELATIVITY trend While Astrazeneca PLC (NYSE:AZN) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Dean Foods Company was in BEARISH territory and Astrazeneca PLC was in BULLISH territory.
DF’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While AZN’s candle is BULLISH with HIGH.
EPS Growth Rate: DF’s 4.07% versus AZN’s 12.5%
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 Dean Foods Company (NYSE:DF) is predicted at 4.07% while Astrazeneca PLC (NYSE:AZN) stands at 12.5%. These numbers suggest that AZN 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 DF stands at 1.5 while AZN is at 0.7 whereas the debt ratio of the prior is 1.41 while the debt ratio of the later is 1.56.
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 3.3 for DF and 1.5 for AZN which means DF has Sell rating whereas AZN 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 DF is $7.58 which is 21.24% of its current price while AZN has price target of 41.66 which is 2.42% 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.
DF currently has price to earning P/E ratio of 0 whereas AZN has 38.1 while the forward P/E ratio for the prior stands at 10.57 and for the later it depicts the value of 21.71.
The price to Book P/B for DF is 0.9, Price to Sale is at 0.07 and for AZN these ratios stand at 8.15 and 4.62.