The shares of QUALCOMM Incorporated (NASDAQ:QCOM) and Ctrip.com International, Ltd. (NASDAQ:CTRP) were among the active stocks of the last trading sessions. QUALCOMM Incorporated (NASDAQ:QCOM) declined to -8.16% closing at the price of $58.05 whereas the shares of Ctrip.com International, Ltd. (NASDAQ:CTRP) declined -19.02% with the decrease of -6.55 points closing at the price of $27.89. QUALCOMM Incorporated has currently increase 5.11% in its stock over the period of 6-months while its rival Ctrip.com International, Ltd. subtracted -35.29% 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 QUALCOMM Incorporated (NASDAQ:QCOM) is 3.6% while the ROI of Ctrip.com International, Ltd. (NASDAQ:CTRP) is 1%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, QCOM’s EBITDA Margin is 12.17 whereas CTRP’s is 28.3.
Both the profitability ratios suggest a mixed sentiment for QUALCOMM Incorporated (NASDAQ:QCOM) and Ctrip.com International, Ltd. (NASDAQ:CTRP).
EPS & Surprise Factor
QUALCOMM Incorporated (NASDAQ:QCOM) reported $0.9/share EPS for the previous quarter where analysts were predicting an EPS to be $0.83/share Thus beating the analyst Estimates with a Surprise Factor of 8.4 Percent. While, Ctrip.com International, Ltd. (NASDAQ:CTRP) reported EPS of $0.42/share in the last quarter. The analysts projected EPS of $0.27/share depicting a Surprise of 55.6 Percent.
Taking a look at Earnings per Share, Ctrip.com International, Ltd. tends to be beating the analyst estimates more than QUALCOMM Incorporated. so CTRP is more profitable than QCOM.
Technical Analysis of QUALCOMM Incorporated & Ctrip.com International, Ltd.
Moving average convergence divergence (MACD) shows that QUALCOMM Incorporated (NASDAQ:QCOM) is on a PRICE RELATIVITY trend While Ctrip.com International, Ltd. (NASDAQ:CTRP) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the QUALCOMM Incorporated was in BEARISH territory and Ctrip.com International, Ltd. was in BULLISH territory.
QCOM’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While CTRP’s candle is BEARISH with HIGH.
EPS Growth Rate: QCOM’s 10.73% versus CTRP’s 3.56%
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 QUALCOMM Incorporated (NASDAQ:QCOM) is predicted at 10.73% while Ctrip.com International, Ltd. (NASDAQ:CTRP) stands at 3.56%. These numbers suggest that QCOM 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 QCOM stands at 2.7 while CTRP is at 1.3 whereas the debt ratio of the prior is 0.97 while the debt ratio of the later is 0.61.
The values of the both ratios suggest that QCOM 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 QCOM and 1.9 for CTRP which means QCOM has Hold rating whereas CTRP 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 QCOM is $72.38 which is 19.8% of its current price while CTRP has price target of 46.99 which is 40.65% 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.
QCOM currently has price to earning P/E ratio of 0 whereas CTRP has 24.15 while the forward P/E ratio for the prior stands at 13.47 and for the later it depicts the value of 18.76.
The price to Book P/B for QCOM is 3.72, Price to Sale is at 3.76 and for CTRP these ratios stand at 1.18 and 3.73.