The shares of Eli Lilly and Company (NYSE:LLY) and Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) were among the active stocks of the last trading sessions. Eli Lilly and Company (NYSE:LLY) soared to 0.35% closing at the price of $110.1 whereas the shares of Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) soared 2.65% with the increase of 1.27 points closing at the price of $49.27. Eli Lilly and Company has currently increase 33.54% in its stock over the period of 6-months while its rival Norwegian Cruise Line Holdings Ltd. subtracted -4.26% 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 Eli Lilly and Company (NYSE:LLY) is 6.6% while the ROI of Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) is 8.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, LLY’s EBITDA Margin is 16.15 whereas NCLH’s is 10.4.
Both the profitability ratios suggest a mixed sentiment for Eli Lilly and Company (NYSE:LLY) and Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH).
EPS & Surprise Factor
Eli Lilly and Company (NYSE:LLY) reported $1.39/share EPS for the previous quarter where analysts were predicting an EPS to be $1.35/share Thus beating the analyst Estimates with a Surprise Factor of 3 Percent. While, Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) reported EPS of $2.27/share in the last quarter. The analysts projected EPS of $2.21/share depicting a Surprise of 2.7 Percent.
Taking a look at Earnings per Share, Eli Lilly and Company tends to be beating the analyst estimates more than Norwegian Cruise Line Holdings Ltd.. so LLY is more profitable than NCLH.
Technical Analysis of Eli Lilly and Company & Norwegian Cruise Line Holdings Ltd.
Moving average convergence divergence (MACD) shows that Eli Lilly and Company (NYSE:LLY) is on a PRICE RELATIVITY trend While Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Eli Lilly and Company was in BULLISH territory and Norwegian Cruise Line Holdings Ltd. was in BULLISH territory.
LLY’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While NCLH’s candle is BULLISH with HIGH.
EPS Growth Rate: LLY’s 11.95% versus NCLH’s 13.15%
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 Eli Lilly and Company (NYSE:LLY) is predicted at 11.95% while Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH) stands at 13.15%. These numbers suggest that NCLH 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 LLY stands at 1.4 while NCLH is at 0.2 whereas the debt ratio of the prior is 1.06 while the debt ratio of the later is 1.2.
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 LLY and 1.8 for NCLH which means LLY has Hold rating whereas NCLH 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 LLY is $111.59 which is 1.34% of its current price while NCLH has price target of 65.35 which is 24.61% 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.
LLY currently has price to earning P/E ratio of 65.54 whereas NCLH has 13.69 while the forward P/E ratio for the prior stands at 19.18 and for the later it depicts the value of 9.54.
The price to Book P/B for LLY is 9.81, Price to Sale is at 5 and for NCLH these ratios stand at 1.93 and 1.93.