The shares of ASML Holding N.V. (NASDAQ:ASML) and Univar Inc. (NYSE:UNVR) were among the active stocks of the last trading sessions. ASML Holding N.V. (NASDAQ:ASML) declined to -1.37% closing at the price of $174.99 whereas the shares of Univar Inc. (NYSE:UNVR) declined -0.78% with the decrease of -0.18 points closing at the price of $22.87. ASML Holding N.V. has currently decrease -11.98% in its stock over the period of 6-months while its rival Univar Inc. subtracted -15.01% 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 ASML Holding N.V. (NASDAQ:ASML) is 16% while the ROI of Univar Inc. (NYSE:UNVR) is 9.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, ASML’s EBITDA Margin is 19.11 whereas UNVR’s is 9.97.
Both the profitability ratios suggest that ASML Holding N.V. (NASDAQ:ASML) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
ASML Holding N.V. (NASDAQ:ASML) reported $1.86/share EPS for the previous quarter where analysts were predicting an EPS to be $1.81/share Thus beating the analyst Estimates with a Surprise Factor of 2.8 Percent. While, Univar Inc. (NYSE:UNVR) reported EPS of $0.4/share in the last quarter. The analysts projected EPS of $0.42/share depicting a Surprise of -4.8 Percent.
Taking a look at Earnings per Share, ASML Holding N.V. tends to be beating the analyst estimates more than Univar Inc.. so ASML is more profitable than UNVR.
Technical Analysis of ASML Holding N.V. & Univar Inc.
Moving average convergence divergence (MACD) shows that ASML Holding N.V. (NASDAQ:ASML) is on a PRICE RELATIVITY trend While Univar Inc. (NYSE:UNVR) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the ASML Holding N.V. was in BULLISH territory and Univar Inc. was in BEARISH territory.
ASML’s current statistics gauge that the stock candle is BULLISH with MEDIUM volatility. While UNVR’s candle is BULLISH with HIGH.
EPS Growth Rate: ASML’s 21.4% versus UNVR’s 22.57%
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 ASML Holding N.V. (NASDAQ:ASML) is predicted at 21.4% while Univar Inc. (NYSE:UNVR) stands at 22.57%. These numbers suggest that UNVR 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 ASML stands at 2.8 while UNVR is at 1.6 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 2.29.
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 2.2 for ASML and 1.9 for UNVR which means ASML has Hold rating whereas UNVR 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 ASML is $221.5 which is 21% of its current price while UNVR has price target of 34.75 which is 34.19% 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.
ASML currently has price to earning P/E ratio of 26.83 whereas UNVR has 12.88 while the forward P/E ratio for the prior stands at 21.68 and for the later it depicts the value of 11.05.
The price to Book P/B for ASML is 5.83, Price to Sale is at 6.27 and for UNVR these ratios stand at 2.76 and 0.38.