The shares of Seagate Technology PLC (NASDAQ:STX) and TransEnterix, Inc. (NYSE:TRXC) were among the active stocks of the last trading sessions. Seagate Technology PLC (NASDAQ:STX) declined to -1.03% closing at the price of $45.33 whereas the shares of TransEnterix, Inc. (NYSE:TRXC) soared 0.88% with the increase of 0.03 points closing at the price of $3.42. Seagate Technology PLC has currently decrease -20.07% in its stock over the period of 6-months while its rival TransEnterix, Inc. added 61.32% 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 Seagate Technology PLC (NASDAQ:STX) is 29.6% while the ROI of TransEnterix, Inc. (NYSE:TRXC) is -30.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, STX’s EBITDA Margin is 6.65 whereas TRXC’s is -15.45.
Both the profitability ratios suggest that Seagate Technology PLC (NASDAQ:STX) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Seagate Technology PLC (NASDAQ:STX) reported $1.7/share EPS for the previous quarter where analysts were predicting an EPS to be $1.55/share Thus beating the analyst Estimates with a Surprise Factor of 9.7 Percent. While, TransEnterix, Inc. (NYSE:TRXC) reported EPS of $-0.06/share in the last quarter. The analysts projected EPS of $-0.07/share depicting a Surprise of 14.3 Percent.
Taking a look at Earnings per Share, TransEnterix, Inc. tends to be beating the analyst estimates more than Seagate Technology PLC. so TRXC is more profitable than STX.
Technical Analysis of Seagate Technology PLC & TransEnterix, Inc.
Moving average convergence divergence (MACD) shows that Seagate Technology PLC (NASDAQ:STX) is on a PRICE RELATIVITY trend While TransEnterix, Inc. (NYSE:TRXC) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Seagate Technology PLC was in BULLISH territory and TransEnterix, Inc. was in BULLISH territory.
STX’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While TRXC’s candle is BEARISH with HIGH.
EPS Growth Rate: STX’s 10.41% versus TRXC’s 0%
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 Seagate Technology PLC (NASDAQ:STX) is predicted at 10.41% while TransEnterix, Inc. (NYSE:TRXC) stands at 0%. These numbers suggest that STX 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 STX stands at 1.4 while TRXC is at 7.4 whereas the debt ratio of the prior is 2.61 while the debt ratio of the later is 0.11.
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 for STX and 2.4 for TRXC which means STX has Hold rating whereas TRXC has Hold 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 STX is $52.9 which is 14.31% of its current price while TRXC has price target of 6.17 which is 44.57% 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.
STX currently has price to earning P/E ratio of 7.78 whereas TRXC has 0 while the forward P/E ratio for the prior stands at 7.97 and for the later it depicts the value of 0.
The price to Book P/B for STX is 7.05, Price to Sale is at 1.16 and for TRXC these ratios stand at 4.22 and 48.32.