The shares of California Resources Corporation (NYSE:CRC) and Huntsman Corporation (NYSE:HUN) were among the active stocks of the last trading sessions. California Resources Corporation (NYSE:CRC) declined to -8.11% closing at the price of $26.96 whereas the shares of Huntsman Corporation (NYSE:HUN) declined -2.24% with the decrease of -0.53 points closing at the price of $23.15. California Resources Corporation has currently decrease -21.42% in its stock over the period of 6-months while its rival Huntsman Corporation subtracted -26.76% 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 California Resources Corporation (NYSE:CRC) is 1.5% while the ROI of Huntsman Corporation (NYSE:HUN) is 13.8%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, CRC’s EBITDA Margin is 9.1 whereas HUN’s is 6.03.
Both the profitability ratios suggest a mixed sentiment for California Resources Corporation (NYSE:CRC) and Huntsman Corporation (NYSE:HUN).
EPS & Surprise Factor
California Resources Corporation (NYSE:CRC) reported $0.81/share EPS for the previous quarter where analysts were predicting an EPS to be $0.36/share Thus beating the analyst Estimates with a Surprise Factor of 125 Percent. While, Huntsman Corporation (NYSE:HUN) reported EPS of $0.84/share in the last quarter. The analysts projected EPS of $0.82/share depicting a Surprise of 2.4 Percent.
Taking a look at Earnings per Share, California Resources Corporation tends to be beating the analyst estimates more than Huntsman Corporation. so CRC is more profitable than HUN.
Technical Analysis of California Resources Corporation & Huntsman Corporation
Moving average convergence divergence (MACD) shows that California Resources Corporation (NYSE:CRC) is on a PRICE RELATIVITY trend While Huntsman Corporation (NYSE:HUN) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the California Resources Corporation was in BEARISH territory and Huntsman Corporation was in BULLISH territory.
CRC’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While HUN’s candle is BEARISH with HIGH.
EPS Growth Rate: CRC’s 0% versus HUN’s 14%
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 California Resources Corporation (NYSE:CRC) is predicted at 0% while Huntsman Corporation (NYSE:HUN) stands at 14%. These numbers suggest that HUN 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 CRC stands at 0.6 while HUN is at 1.9 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 0.84.
The values of the both ratios suggest that HUN is more suitable investment when the liquidity and risk is the main concern.
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 2.4 for CRC and 2.3 for HUN which means CRC has Hold rating whereas HUN 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 CRC is $50.57 which is 46.69% of its current price while HUN has price target of 34 which is 31.91% 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.
CRC currently has price to earning P/E ratio of 0 whereas HUN has 6.41 while the forward P/E ratio for the prior stands at 7.12 and for the later it depicts the value of 6.83.
The price to Book P/B for CRC is 0, Price to Sale is at 0.67 and for HUN these ratios stand at 1.86 and 0.59.