Earnings

Set Sail With Sealed Air Corporation (SEE), F.N.B. Corporation (FNB)

The shares of Sealed Air Corporation have decreased by more than -29.13% this year alone. The shares recently went down by -3.29% or -$1.19 and now trades at $34.94. The shares of F.N.B. Corporation (NYSE:FNB), has slumped by -11.36% year to date as of 10/11/2018. The shares currently trade at $12.25 and have been able to report a change of -4.15% over the past one week.

The stock of Sealed Air Corporation and F.N.B. Corporation 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.

Next 5Y EPS Growth: 22.45% versus 9.50%

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 SEE will grow it’s earning at a 22.45% annual rate in the next 5 years. This is in contrast to FNB which will have a positive growth at a 9.50% annual rate. This means that the higher growth rate of SEE 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. SEE has an EBITDA margin of 16.25%, this implies that the underlying business of FNB is more profitable. The ROI of SEE is 9.00% while that of FNB is 11.30%. These figures suggest that FNB ventures generate a higher ROI than that of SEE.

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, SEE’s free cash flow per share is a positive 0.32, while that of FNB is positive 7.89.

Valuation

SEE currently trades at a forward P/E of 12.22, and a P/S of 1.20 while FNB trades at a forward P/E of 10.39, a P/B of 0.91, and a P/S of 3.63. This means that looking at the earnings, book values and sales basis, SEE 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 SEE is currently at a -30.01% to its one-year price target of 49.92. Looking at its rival pricing, FNB is at a -18.33% relative to its price target of 15.00.




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), SEE is given a 2.20 while 2.00 placed for FNB. This means that analysts are more bullish on the outlook for SEE 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 SEE is 5.63 while that of FNB is just 6.99. This means that analysts are more bullish on the forecast for SEE stock.

Conclusion

The stock of Sealed Air Corporation defeats that of F.N.B. Corporation when the two are compared, with SEE taking 7 out of the total factors that were been considered. SEE 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, SEE is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for SEE is better on when it is viewed on short interest.

Previous ArticleNext Article

Related Post

Which Market Offer More Value? – Fortune Bra... The shares of Fortune Brands Home & Security, Inc. have decreased by more than -15.25% this year alone. The shares recently went up by 2.64% or $...
A Comparison of Top Movers: ReShape Lifesciences I... The shares of ReShape Lifesciences Inc. have decreased by more than -99.73% this year alone. The shares recently went up by 7.45% or $0.01 and now tra...
Financially Devastating or Fantastic? – Pern... The shares of Pernix Therapeutics Holdings, Inc. have decreased by more than -60.83% this year alone. The shares recently went down by -5.05% or -$0.0...
Are These Stocks A Sure Bet? – News Corporat... The shares of News Corporation have decreased by more than -19.19% this year alone. The shares recently went down by -0.68% or -$0.09 and now trades a...
Financial Metrics You Should Care About: Patterson... The shares of Patterson-UTI Energy, Inc. have decreased by more than -23.38% this year alone. The shares recently went up by 1.61% or $0.28 and now tr...