Shares of Sibanye Gold Limited (NYSE: SBGL) and Target Corporation (NYSE: TGT) were among the shares traded in recent trading sessions. Sibanye Gold Limited (NYSE: SBGL) fell to -0.39%, closing at $ 2.55, while shares of Target Corporation (NYSE: TGT) rose 0.21%, up 0.18% closing at $ 84.41. Sibanye Gold Limited currently reduced -18.27% in its shares over the 6-month period, while its rival Target Corporation added 21.75% in the previous 6 months.
Now we have to analyze the facts that if the shares were worthy of investor money? The facts to be analyzed here are risks, profitability, returns and price trends.
Returns and Profitability
Profitability and returns are the main reason for investing, investors are looking for profits that get and return that they should expect over the time period.
The first and most important return that is considered when making an investment is the ROI or return on investment. ROI is the ratio of profit versus cost of investment. Currently, the ROI of Sibanye Gold Limited (NYSE: SBGL) is 0.7%, while the ROI of Target Corporation (NYSE: TGT) is 13.2%. Another value that should be considered when analyzing the profitability of a stock is its EBITDA margin, SBGL's EBITDA margin is 5.55, while the TGT is 8.14.
Both profitability ratios suggest that Target Corporation (NYSE: TGT) is a more appropriate investment in terms of profitability and return.
EPS and Surprise Factor
Technical Analysis of Sibanye Gold Limited & Target Corporation
The moving average convergence divergence (MACD) shows that Sibanye Gold Limited (NYSE: SBGL) is in a trend of PRICE RELATIVITY While Target Corporation (NYSE: TGT) is in the PRICE RELATIVITY trend. The trend of the last 10 days shows that Sibanye Gold Limited was in BEARISH territory and Target Corporation was in BULLISH territory.
Current SBGL statistics measure that the stock candle is BULLISH with high volatility. While the TGT sail is BEARISH with MEDIUM.
EPS growth rate: 0% of SBGL versus 8% of TGT
Another shareholder value can be analyzed through the EPS growth rate; The EPS growth rate over the next 5 years is predicted by analysts after analyzing past trends. Sibanye Gold Limited's (NYSE: SBGL) next five-year EPS growth rate is forecast at 0%, while Target Corporation (NYSE: TGT) stands at 8%. These numbers suggest that the TGT is a more adequate investment in terms of EPS growth rate.
Financial Risks 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 repay its debt and how quickly it can meet its obligations. The current SBGL ratio is 1.8 while the TGT is 0.8 while the debt ratio of the former is 1.13 while the debt ratio of the latter is 1.
Values of both proportions suggest that SBGL is a more appropriate investment when liquidity and risk are the primary concern.
When making an investment, another important factor to consider before investing is the analyst's recommendation on the scale of 1 to 5, where 1 is the strong buy, 2 is the buy, 3 the wait, 4 the Sale and 5 the sale strong. The analyst recommends 1 for the SBGL and 2.6 for the TGT, which means that the SBGL has Strong Buy rating, while the TGT has a Suspension rating.
Another recommendation of the analyst that should be considered worthy is the price target. The price or price trend of the mare does not suggest the suitability of an action. The price target set by the analyst should also be considered during the investment, as it suggests to what extent the stock will rise or fall in the near future. The defined price target for SBGL is $ 5.57, which is 54.22% of its current price, while TGT has a price target of 89.82, which represents 6.02% of its price current.
Valuation is the process of determining the value of the company to an investor, valuation rates give insight into that value.
SBGL currently has a price to gain a P / E ratio of 48.11, while the TGT has 16.9, while the forward P / E ratio to the previous one is at 7.08, and for the latter it represents the value of 14 , 94.
The price for the Book P / B for the SBGL is 0.81, the Price to Sale is 0.41 and for the TGT these ratios are 4.02 and 0.61.