Earnings

Are These Stocks A Sure Bet? – F.N.B. Corporation (FNB), MongoDB, Inc. (MDB)

The shares of F.N.B. Corporation have decreased by more than -16.50% this year alone. The shares recently went down by -5.10% or -$0.62 and now trades at $11.54. The shares of MongoDB, Inc. (NASDAQ:MDB), has jumped by 182.11% year to date as of 12/04/2018. The shares currently trade at $83.73 and have been able to report a change of 5.25% over the past one week.

The stock of F.N.B. Corporation and MongoDB, Inc. were two of the most active stocks on Tuesday. 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. FNB has an EBITDA margin of 67.09%, this implies that the underlying business of FNB is more profitable. The ROI of FNB is 11.30% while that of MDB is -50.90%. These figures suggest that FNB ventures generate a higher ROI than that of MDB.

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, FNB’s free cash flow per share is a positive 8.95, while that of MDB is negative -0.01.

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 debt ratio of FNB is 0.46 compared to 1.01 for MDB. MDB can be able to settle its long-term debts and thus is a lower financial risk than FNB.

Valuation

FNB currently trades at a forward P/E of 9.84, a P/B of 0.85, and a P/S of 3.29 while MDB trades at a P/B of 20.52, and a P/S of 22.47. This means that looking at the earnings, book values and sales basis, FNB 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 FNB is currently at a -18.45% to its one-year price target of 14.15. Looking at its rival pricing, MDB is at a 0.32% relative to its price target of 83.46.




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), FNB is given a 2.00 while 2.30 placed for MDB. This means that analysts are more bullish on the outlook for MDB 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 FNB is 5.80 while that of MDB is just 5.22. This means that analysts are more bullish on the forecast for MDB stock.

Conclusion

The stock of MongoDB, Inc. defeats that of F.N.B. Corporation when the two are compared, with MDB taking 4 out of the total factors that were been considered. MDB 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, MDB is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for MDB is better on when it is viewed on short interest.

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