The shares of Knowles Corporation have decreased by more than -15.69% this year alone. The shares recently went down by -2.52% or -$0.32 and now trades at $12.36. The shares of Crescent Point Energy Corp. (NYSE:CPG), has jumped by 1.84% year to date as of 04/16/2018. The shares currently trade at $7.76 and have been able to report a change of 7.78% over the past one week.
The stock of Knowles Corporation and Crescent Point Energy Corp. 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. KN has an EBITDA margin of 42.24%, this implies that the underlying business of KN is more profitable. These figures suggest that KN ventures generate a higher ROI than that of CPG.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, KN’s free cash flow per share is a positive 0.01, while that of CPG is negative -4.25.Valuation
KN currently trades at a forward P/E of 12.00, a P/B of 0.98, and a P/S of 1.48 while CPG trades at a forward P/E of 388.00, a P/B of 0.59, and a P/S of 1.96. This means that looking at the earnings, book values and sales basis, KN 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 KN is currently at a -26.56% to its one-year price target of 16.83. Looking at its rival pricing, CPG is at a -12.32% relative to its price target of 8.85.
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), KN is given a 2.20 while 3.00 placed for CPG. This means that analysts are more bullish on the outlook for CPG 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 KN is 12.78 while that of CPG is just 3.36. This means that analysts are more bullish on the forecast for CPG stock.
The stock of Crescent Point Energy Corp. defeats that of Knowles Corporation when the two are compared, with CPG taking 4 out of the total factors that were been considered. CPG 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, CPG is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for CPG is better on when it is viewed on short interest.