The shares of Extraction Oil & Gas, Inc. (NASDAQ:XOG) and Amazon.com, Inc. (NASDAQ:AMZN) were among the active stocks of the last trading sessions. Extraction Oil & Gas, Inc. (NASDAQ:XOG) declined to -8.42% closing at the price of $8.65 whereas the shares of Amazon.com, Inc. (NASDAQ:AMZN) declined -0.03% with the decrease of -0.58 points closing at the price of $1754.91. Extraction Oil & Gas, Inc. has currently decrease -41.19% in its stock over the period of 6-months while its rival Amazon.com, Inc. added 9.48% 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 Extraction Oil & Gas, Inc. (NASDAQ:XOG) is 0.7% while the ROI of Amazon.com, Inc. (NASDAQ:AMZN) is 3.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, XOG’s EBITDA Margin is 10.05 whereas AMZN’s is 42.72.
Both the profitability ratios suggest that Amazon.com, Inc. (NASDAQ:AMZN) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Extraction Oil & Gas, Inc. (NASDAQ:XOG) reported $0.43/share EPS for the previous quarter where analysts were predicting an EPS to be $0.09/share Thus beating the analyst Estimates with a Surprise Factor of 377.8 Percent. While, Amazon.com, Inc. (NASDAQ:AMZN) reported EPS of $5.75/share in the last quarter. The analysts projected EPS of $3.14/share depicting a Surprise of 83.1 Percent.
Taking a look at Earnings per Share, Extraction Oil & Gas, Inc. tends to be beating the analyst estimates more than Amazon.com, Inc.. so XOG is more profitable than AMZN.
Technical Analysis of Extraction Oil & Gas, Inc. & Amazon.com, Inc.
Moving average convergence divergence (MACD) shows that Extraction Oil & Gas, Inc. (NASDAQ:XOG) is on a PRICE RELATIVITY trend While Amazon.com, Inc. (NASDAQ:AMZN) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Extraction Oil & Gas, Inc. was in BULLISH territory and Amazon.com, Inc. was in BULLISH territory.
XOG’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While AMZN’s candle is BULLISH with HIGH.
EPS Growth Rate: XOG’s 30% versus AMZN’s 44.33%
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 Extraction Oil & Gas, Inc. (NASDAQ:XOG) is predicted at 30% while Amazon.com, Inc. (NASDAQ:AMZN) stands at 44.33%. These numbers suggest that AMZN 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 XOG stands at 0.4 while AMZN is at 1.1 whereas the debt ratio of the prior is 0.83 while the debt ratio of the later is 1.21.
The values of the both ratios suggest that AMZN 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 for XOG and 1.7 for AMZN which means XOG has Buy rating whereas AMZN 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 XOG is $15.75 which is 45.08% of its current price while AMZN has price target of 2136.14 which is 17.85% 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.
XOG currently has price to earning P/E ratio of 0 whereas AMZN has 108.01 while the forward P/E ratio for the prior stands at 8.73 and for the later it depicts the value of 65.82.
The price to Book P/B for XOG is 0.95, Price to Sale is at 1.73 and for AMZN these ratios stand at 21.89 and 3.88.