The shares of Whiting Petroleum Corporation have increased by more than 39.77% this year alone. The shares recently went down by -0.08% or -$0.03 and now trades at $37.01. The shares of Twenty-First Century Fox, Inc. (NASDAQ:FOX), has jumped by 5.72% year to date as of 04/12/2018. The shares currently trade at $36.07 and have been able to report a change of 0.19% over the past one week.
The stock of Whiting Petroleum Corporation and Twenty-First Century Fox, Inc. were two of the most active stocks on Thuday. Investors seem to be very interested in what happens to the stocks of these two companies but do investors favor one over the other? We will analyze the growth, profitability, risk, valuation, and insider trends of both companies and see which one investors prefer.Next 5Y EPS Growth: 0.80% versus 10.40%
When a company is able to grow consistently in terms of earnings at a high compound rate have the highest likelihood of creating value for its shareholders over time. Analysts have predicted that WLL will grow it’s earning at a 0.80% annual rate in the next 5 years. This is in contrast to FOX which will have a positive growth at a 10.40% annual rate. This means that the higher growth rate of FOX implies a greater potential for capital appreciation over the years.Profitability and Returns
Growth alone cannot be used to see if the company will be valuable. Shareholders will be the losers if a company invest in ventures that aren’t profitable enough to support upbeat growth. In order for us to accurately measure profitability and return, we will be using the EBITDA margin and Return on Investment (ROI), which balances the difference in capital structure. These figures suggest that FOX ventures generate a higher ROI than that of WLL.Cash Flow
The value of a stock is ultimately determined by the amount of cash flow that the investors have available. Over the last 12 months, WLL’s free cash flow per share is a positive 4.67, while that of FOX is negative -2.99.Valuation
WLL currently trades at a forward P/E of 46.49, a P/B of 0.86, and a P/S of 2.38 while FOX trades at a forward P/E of 16.03, a P/B of 3.63, This means that looking at the earnings, book values and sales basis, WLL is the cheaper one. It is very obvious that earnings are the most important factors to investors, thus analysts are most likely to place their bet on the P/E.Analyst Price Targets and Opinions
The mistake some people make is that they think a cheap stock has more value to it. In order to know the value of a stock, there is need to compare its current price to its likely trading price in the future. The price of WLL is currently at a 0.76% to its one-year price target of 36.73. Looking at its rival pricing, FOX is at a -19.84% relative to its price target of 45.00.
When looking at the investment recommendation on say a scale of 1 to 5 (1 being a strong buy, 3 a hold, and 5 a sell), WLL is given a 2.40 while 1.00 placed for FOX. This means that analysts are more bullish on the outlook for WLL stocks.Insider Activity and Investor Sentiment
Short interest or otherwise called the percentage of a stock’s tradable shares currently being shorted is another data that investors use to get a handle on sentiment. The short ratio for WLL is 2.93 while that of FOX is just 2.45. This means that analysts are more bullish on the forecast for FOX stock.
The stock of Whiting Petroleum Corporation defeats that of Twenty-First Century Fox, Inc. when the two are compared, with WLL taking 4 out of the total factors that were been considered. WLL happens to be more profitable, generates a higher ROI, has higher cash flow per share, higher liquidity and has a lower financial risk. When looking at the stock valuation, WLL is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for WLL is better on when it is viewed on short interest.