The shares of Halcon Resources Corporation (NYSE:HK) and Take-Two Interactive Software, Inc. (NASDAQ:TTWO) were among the active stocks of the last trading sessions. Halcon Resources Corporation (NYSE:HK) declined to -8.9% closing at the price of $3.48 whereas the shares of Take-Two Interactive Software, Inc. (NASDAQ:TTWO) declined -5.3% with the decrease of -6.67 points closing at the price of $119.14. Halcon Resources Corporation has currently decrease -28.54% in its stock over the period of 6-months while its rival Take-Two Interactive Software, Inc. added 2.63% 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 Halcon Resources Corporation (NYSE:HK) is 59.8% while the ROI of Take-Two Interactive Software, Inc. (NASDAQ:TTWO) is 12.3%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, HK’s EBITDA Margin is -509.14 whereas TTWO’s is 53.01.
Both the profitability ratios suggest a mixed sentiment for Halcon Resources Corporation (NYSE:HK) and Take-Two Interactive Software, Inc. (NASDAQ:TTWO).
EPS & Surprise Factor
Halcon Resources Corporation (NYSE:HK) reported $-0.06/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.06/share Thus meeting the analyst Estimates with a Surprise Factor of 0 Percent. While, Take-Two Interactive Software, Inc. (NASDAQ:TTWO) reported EPS of $1.05/share in the last quarter. The analysts projected EPS of $0.93/share depicting a Surprise of 12.9 Percent.
Taking a look at Earnings per Share, Take-Two Interactive Software, Inc. tends to be beating the analyst estimates more than Halcon Resources Corporation. so TTWO is more profitable than HK.
Technical Analysis of Halcon Resources Corporation & Take-Two Interactive Software, Inc.
Moving average convergence divergence (MACD) shows that Halcon Resources Corporation (NYSE:HK) is on a PRICE RELATIVITY trend While Take-Two Interactive Software, Inc. (NASDAQ:TTWO) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Halcon Resources Corporation was in BULLISH territory and Take-Two Interactive Software, Inc. was in BULLISH territory.
HK’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While TTWO’s candle is BEARISH with MEDIUM.
EPS Growth Rate: HK’s 0% versus TTWO’s 24.5%
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 Halcon Resources Corporation (NYSE:HK) is predicted at 0% while Take-Two Interactive Software, Inc. (NASDAQ:TTWO) stands at 24.5%. These numbers suggest that TTWO 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 HK stands at 0.9 while TTWO is at 1.5 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 0.
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 2.3 for HK and 1.8 for TTWO which means HK has Hold rating whereas TTWO 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 HK is $8.58 which is 59.44% of its current price while TTWO has price target of 141 which is 15.5% 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.
HK currently has price to earning P/E ratio of 0.88 whereas TTWO has 71.81 while the forward P/E ratio for the prior stands at 14.44 and for the later it depicts the value of 22.9.
The price to Book P/B for HK is 0.49, Price to Sale is at 2.52 and for TTWO these ratios stand at 7.26 and 7.73.