The shares of Palatin Technologies, Inc. have increased by more than 67.66% this year alone. The shares recently went up by 2.13% or $0.03 and now trades at $1.44. The shares of ONEOK, Inc. (NYSE:OKE), has jumped by 11.79% year to date as of 04/16/2018. The shares currently trade at $59.75 and have been able to report a change of 5.29% over the past one week.
The stock of Palatin Technologies, Inc. and ONEOK, Inc. were two of the most active stocks on Monday. 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.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. PTN has an EBITDA margin of 31.5%, this implies that the underlying business of PTN is more profitable. The ROI of PTN is -124.40% while that of OKE is 7.30%. These figures suggest that OKE ventures generate a higher ROI than that of PTN.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, PTN’s free cash flow per share is a positive -0, while that of OKE is negative -0.71.Liquidity and Financial Risk
The ability of a company to meet up with its short-term obligations and be able to clear its longer-term debts is measured using Liquidity and leverage ratios. The current ratio for PTN is 1.50 and that of OKE is 0.70. This implies that it is easier for PTN to cover its immediate obligations over the next 12 months than OKE. The debt ratio of PTN is 1.06 compared to 1.65 for OKE. OKE can be able to settle its long-term debts and thus is a lower financial risk than PTN.Valuation
PTN currently trades at a P/B of 28.80, and a P/S of 3.52 while OKE trades at a forward P/E of 22.26, a P/B of 4.17, and a P/S of 2.01. This means that looking at the earnings, book values and sales basis, OKE 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 PTN is currently at a -73.82% to its one-year price target of 5.50. Looking at its rival pricing, OKE is at a -6.99% relative to its price target of 64.24.
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), PTN is given a 1.70 while 2.20 placed for OKE. This means that analysts are more bullish on the outlook for OKE 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 PTN is 2.89 while that of OKE is just 3.75. This means that analysts are more bullish on the forecast for PTN stock.
The stock of ONEOK, Inc. defeats that of Palatin Technologies, Inc. when the two are compared, with OKE taking 5 out of the total factors that were been considered. OKE 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, OKE is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for OKE is better on when it is viewed on short interest.