The shares of H&R Block, Inc. (NYSE:HRB) and FMC Corporation (NYSE:FMC) were among the active stocks of the last trading sessions. H&R Block, Inc. (NYSE:HRB) soared to 0.04% closing at the price of $28.33 whereas the shares of FMC Corporation (NYSE:FMC) declined -0.32% with the decrease of -0.27 points closing at the price of $83.67. H&R Block, Inc. has currently increase 1.72% in its stock over the period of 6-months while its rival FMC Corporation subtracted -5.88% 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 H&R Block, Inc. (NYSE:HRB) is 37.6% while the ROI of FMC Corporation (NYSE:FMC) is 5.4%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, HRB’s EBITDA Margin is 6.3 whereas FMC’s is 11.71.
Both the profitability ratios suggest a mixed sentiment for H&R Block, Inc. (NYSE:HRB) and FMC Corporation (NYSE:FMC).
EPS & Surprise Factor
H&R Block, Inc. (NYSE:HRB) reported $-0.72/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.77/share Thus beating the analyst Estimates with a Surprise Factor of 6.5 Percent. While, FMC Corporation (NYSE:FMC) reported EPS of $0.98/share in the last quarter. The analysts projected EPS of $0.92/share depicting a Surprise of 6.5 Percent.
Taking a look at Earnings per Share, FMC Corporation tends to be beating the analyst estimates more than H&R Block, Inc.. so FMC is more profitable than HRB.
Technical Analysis of H&R Block, Inc. & FMC Corporation
Moving average convergence divergence (MACD) shows that H&R Block, Inc. (NYSE:HRB) is on a PRICE RELATIVITY trend While FMC Corporation (NYSE:FMC) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the H&R Block, Inc. was in BULLISH territory and FMC Corporation was in BULLISH territory.
HRB’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While FMC’s candle is BULLISH with HIGH.
EPS Growth Rate: HRB’s 10% versus FMC’s 27.8%
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 H&R Block, Inc. (NYSE:HRB) is predicted at 10% while FMC Corporation (NYSE:FMC) stands at 27.8%. These numbers suggest that FMC 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 HRB stands at 2.3 while FMC is at 1.6 whereas the debt ratio of the prior is 7.79 while the debt ratio of the later is 1.02.
The values of the both ratios suggest that HRB 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 2.8 for HRB and 2.1 for FMC which means HRB has Hold rating whereas FMC 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 HRB is $25.43 which is -11.4% of its current price while FMC has price target of 102.5 which is 18.37% 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.
HRB currently has price to earning P/E ratio of 10.34 whereas FMC has 21.33 while the forward P/E ratio for the prior stands at 13.76 and for the later it depicts the value of 12.41.
The price to Book P/B for HRB is 30.79, Price to Sale is at 1.86 and for FMC these ratios stand at 3.76 and 2.78.