Earnings

Which is more compelling pick right now? – C.H. Robinson Worldwide, Inc. (CHRW), Abeona Therapeutics Inc. (ABEO)

The shares of C.H. Robinson Worldwide, Inc. have decreased by more than -1.72% this year alone. The shares recently went up by 2.12% or $1.82 and now trades at $87.56. The shares of Abeona Therapeutics Inc. (NASDAQ:ABEO), has jumped by 35.33% year to date as of 05/17/2018. The shares currently trade at $21.45 and have been able to report a change of 13.79% over the past one week.

The stock of C.H. Robinson Worldwide, Inc. and Abeona Therapeutics 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.

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. CHRW has an EBITDA margin of 5.37%, this implies that the underlying business of CHRW is more profitable. These figures suggest that CHRW ventures generate a higher ROI than that of ABEO.

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, CHRW’s free cash flow per share is a positive 0.81, while that of ABEO is negative -0.9.

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 CHRW is 1.30 and that of ABEO is 20.80. This implies that it is easier for CHRW to cover its immediate obligations over the next 12 months than ABEO. The debt ratio of CHRW is 0.99 compared to 0.00 for ABEO. CHRW can be able to settle its long-term debts and thus is a lower financial risk than ABEO.

Valuation

CHRW currently trades at a forward P/E of 18.18, a P/B of 8.26, and a P/S of 0.80 while ABEO trades at a P/B of 5.96, and a P/S of 1237.40. This means that looking at the earnings, book values and sales basis, CHRW 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 CHRW is currently at a -4.46% to its one-year price target of 91.65. Looking at its rival pricing, ABEO is at a -27.83% relative to its price target of 29.72.




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), CHRW is given a 2.70 while 1.80 placed for ABEO. This means that analysts are more bullish on the outlook for CHRW 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 CHRW is 9.42 while that of ABEO is just 11.75. This means that analysts are more bullish on the forecast for CHRW stock.

Conclusion

The stock of Abeona Therapeutics Inc. defeats that of C.H. Robinson Worldwide, Inc. when the two are compared, with ABEO taking 6 out of the total factors that were been considered. ABEO 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, ABEO is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for ABEO is better on when it is viewed on short interest.

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