The shares of Centennial Resource Development, Inc. (NASDAQ:CDEV) and Zions Bancorporation (NASDAQ:ZION) were among the active stocks of the last trading sessions. Centennial Resource Development, Inc. (NASDAQ:CDEV) declined to -6.91% closing at the price of $18.45 whereas the shares of Zions Bancorporation (NASDAQ:ZION) soared 1.43% with the increase of 0.71 points closing at the price of $50.42. Centennial Resource Development, Inc. has currently decrease -5.58% in its stock over the period of 6-months while its rival Zions Bancorporation subtracted -12.78% 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 Centennial Resource Development, Inc. (NASDAQ:CDEV) is 2.2% while the ROI of Zions Bancorporation (NASDAQ:ZION) is 23.3%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, CDEV’s EBITDA Margin is 10.34 whereas ZION’s is NOT AVAILABLE.
Both the profitability ratios suggest that Zions Bancorporation (NASDAQ:ZION) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Centennial Resource Development, Inc. (NASDAQ:CDEV) reported $0.17/share EPS for the previous quarter where analysts were predicting an EPS to be $0.21/share Thus lagging the analyst Estimates with a Surprise Factor of -19 Percent. While, Zions Bancorporation (NASDAQ:ZION) reported EPS of $1.04/share in the last quarter. The analysts projected EPS of $0.96/share depicting a Surprise of 8.3 Percent.
Taking a look at Earnings per Share, Zions Bancorporation tends to be beating the analyst estimates more than Centennial Resource Development, Inc.. so ZION is more profitable than CDEV.
Technical Analysis of Centennial Resource Development, Inc. & Zions Bancorporation
Moving average convergence divergence (MACD) shows that Centennial Resource Development, Inc. (NASDAQ:CDEV) is on a PRICE RELATIVITY trend While Zions Bancorporation (NASDAQ:ZION) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Centennial Resource Development, Inc. was in BULLISH territory and Zions Bancorporation was in BULLISH territory.
CDEV’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While ZION’s candle is BULLISH with HIGH.
EPS Growth Rate: CDEV’s 61.15% versus ZION’s 7%
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 Centennial Resource Development, Inc. (NASDAQ:CDEV) is predicted at 61.15% while Zions Bancorporation (NASDAQ:ZION) stands at 7%. These numbers suggest that CDEV 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 CDEV stands at 0.9 while ZION is at 0 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 0.05.
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 1.7 for CDEV and 2.2 for ZION which means CDEV has Buy rating whereas ZION 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 CDEV is $26.73 which is 30.98% of its current price while ZION has price target of 57 which is 11.54% 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.
CDEV currently has price to earning P/E ratio of 28.3 whereas ZION has 13.26 while the forward P/E ratio for the prior stands at 14.01 and for the later it depicts the value of 11.82.
The price to Book P/B for CDEV is 1.61, Price to Sale is at 7.15 and for ZION these ratios stand at 1.4 and 4.13.