Earnings

A Comparison of Top Movers: Coeur Mining, Inc. (CDE), Viking Therapeutics, Inc. (VKTX)

The shares of Coeur Mining, Inc. have decreased by more than -30.80% this year alone. The shares recently went down by -2.81% or -$0.15 and now trades at $5.19. The shares of Viking Therapeutics, Inc. (NASDAQ:VKTX), has jumped by 234.24% year to date as of 10/10/2018. The shares currently trade at $13.57 and have been able to report a change of -14.01% over the past one week.

The stock of Coeur Mining, Inc. and Viking Therapeutics, Inc. were two of the most active stocks on Wednesday. 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. CDE has an EBITDA margin of 25.59%, this implies that the underlying business of CDE is more profitable. These figures suggest that CDE ventures generate a higher ROI than that of VKTX.

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 CDE is 2.20 and that of VKTX is 35.10. This implies that it is easier for CDE to cover its immediate obligations over the next 12 months than VKTX. The debt ratio of CDE is 0.51 compared to 0.00 for VKTX. CDE can be able to settle its long-term debts and thus is a lower financial risk than VKTX.

Valuation



CDE currently trades at a forward P/E of 24.95, a P/B of 1.17, and a P/S of 1.38 while VKTX trades at a P/B of 5.10, This means that looking at the earnings, book values and sales basis, CDE 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 CDE is currently at a -45.71% to its one-year price target of 9.56. Looking at its rival pricing, VKTX is at a -58.03% relative to its price target of 32.33.

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), CDE is given a 2.00 while 1.90 placed for VKTX. This means that analysts are more bullish on the outlook for CDE 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 CDE is 4.02 while that of VKTX is just 2.77. This means that analysts are more bullish on the forecast for VKTX stock.

Conclusion

The stock of Coeur Mining, Inc. defeats that of Viking Therapeutics, Inc. when the two are compared, with CDE taking 4 out of the total factors that were been considered. CDE 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, CDE is the cheaper one on an earnings, book value and sales basis. Finally, the sentiment signal for CDE is better on when it is viewed on short interest.

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