The shares of PagSeguro Digital Ltd. (NYSE:PAGS) and Hewlett Packard Enterprise Company (NYSE:HPE) were among the active stocks of the last trading sessions. PagSeguro Digital Ltd. (NYSE:PAGS) declined to -9.11% closing at the price of $25.44 whereas the shares of Hewlett Packard Enterprise Company (NYSE:HPE) soared 0.06% with the increase of 0.01 points closing at the price of $16.25. PagSeguro Digital Ltd. has currently decrease -21.34% in its stock over the period of 6-months while its rival Hewlett Packard Enterprise Company subtracted -8.04% 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 PagSeguro Digital Ltd. (NYSE:PAGS) is 68.7% while the ROI of Hewlett Packard Enterprise Company (NYSE:HPE) is 2.1%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, PAGS’s EBITDA Margin is -185.21 whereas HPE’s is 10.04.
Both the profitability ratios suggest a mixed sentiment for PagSeguro Digital Ltd. (NYSE:PAGS) and Hewlett Packard Enterprise Company (NYSE:HPE).
EPS & Surprise Factor
PagSeguro Digital Ltd. (NYSE:PAGS) reported $0.21/share EPS for the previous quarter where analysts were predicting an EPS to be $0.2/share Thus beating the analyst Estimates with a Surprise Factor of 5 Percent. While, Hewlett Packard Enterprise Company (NYSE:HPE) reported EPS of $0.44/share in the last quarter. The analysts projected EPS of $0.37/share depicting a Surprise of 18.9 Percent.
Taking a look at Earnings per Share, Hewlett Packard Enterprise Company tends to be beating the analyst estimates more than PagSeguro Digital Ltd.. so HPE is more profitable than PAGS.
Technical Analysis of PagSeguro Digital Ltd. & Hewlett Packard Enterprise Company
Moving average convergence divergence (MACD) shows that PagSeguro Digital Ltd. (NYSE:PAGS) is on a PRICE RELATIVITY trend While Hewlett Packard Enterprise Company (NYSE:HPE) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the PagSeguro Digital Ltd. was in BULLISH territory and Hewlett Packard Enterprise Company was in BULLISH territory.
PAGS’s current statistics gauge that the stock candle is BEARISH with MEDIUM volatility. While HPE’s candle is BULLISH with HIGH.
EPS Growth Rate: PAGS’s 16.02% versus HPE’s -7.77%
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 PagSeguro Digital Ltd. (NYSE:PAGS) is predicted at 16.02% while Hewlett Packard Enterprise Company (NYSE:HPE) stands at -7.77%. These numbers suggest that PAGS 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 PAGS stands at 2.7 while HPE is at 1 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 0.52.
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 2.7 for PAGS and 2.7 for HPE which means PAGS has Hold rating whereas HPE 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 PAGS is $33.27 which is 23.53% of its current price while HPE has price target of 18.42 which is 11.78% 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.
PAGS currently has price to earning P/E ratio of 29.34 whereas HPE has 54.53 while the forward P/E ratio for the prior stands at 20.03 and for the later it depicts the value of 10.29.
The price to Book P/B for PAGS is 4.85, Price to Sale is at 9.2 and for HPE these ratios stand at 1.05 and 0.86.