The shares of Pitney Bowes Inc. have decreased by more than -19.50% this year alone. The shares of Zion Oil & Gas, Inc. (NASDAQ:ZN), has jumped by 64.81% year to date as of 07/12/2018. The shares currently trade at $3.56 and have been able to report a change of -9.87% over the past one week.
The stock of Pitney Bowes Inc. and Zion Oil & Gas, Inc. were two of the most active stocks on Thursday. 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. PBI has an EBITDA margin of 15.34%, this implies that the underlying business of PBI is more profitable. These figures suggest that PBI ventures generate a higher ROI than that of ZN.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 PBI is 1.10 and that of ZN is 0.80. This implies that it is easier for PBI to cover its immediate obligations over the next 12 months than ZN. The debt ratio of PBI is 16.67 compared to 0.09 for ZN. PBI can be able to settle its long-term debts and thus is a lower financial risk than ZN.Valuation
PBI currently trades at a forward P/E of 7.10, a P/B of 7.83, and a P/S of 0.45 while ZN trades at a P/B of 8.68, This means that looking at the earnings, book values and sales basis, PBI 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 PBI is currently at a -28.57% to its one-year price target of 12.60.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 PBI is 2.77 while that of ZN is just 7.37. This means that analysts are more bullish on the forecast for PBI stock.
The stock of Zion Oil & Gas, Inc. defeats that of Pitney Bowes Inc. when the two are compared, with ZN taking 5 out of the total factors that were been considered. ZN 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, ZN is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for ZN is better on when it is viewed on short interest.