Dissecting the Numbers for Americold Realty Trust (COLD) and Kirkland Lake Gold Ltd. (KL)

Americold Realty Trust (NYSE:COLD) shares are up more than 39.58% this year and recently increased 1.28% or $0.45 to settle at $35.65. Kirkland Lake Gold Ltd. (NYSE:KL), on the other hand, is up 68.11% year to date as of 09/12/2019. It currently trades at $43.86 and has returned -9.15% during the past week.

Americold Realty Trust (NYSE:COLD) and Kirkland Lake Gold Ltd. (NYSE:KL) are the two most active stocks in the REIT – Industrial industry based on today’s trading volumes. To determine if one is a better investment than the other, we will compare the two companies’ growth, profitability, risk, return, and valuation characteristics, as well as their analyst ratings and sentiment signals.

Growth

Companies that can consistently grow earnings at a high compound rate usually have the greatest potential to create value for shareholders in the long-run. Analysts expect COLD to grow earnings at a 2.60% annual rate over the next 5 years.

Cash Flow

Cash is king when it comes to investing. COLD’s free cash flow (“FCF”) per share for the trailing twelve months was -0.41. Comparatively, KL’s free cash flow per share was +0.03. On a percent-of-sales basis, COLD’s free cash flow was -4.9% while KL converted 0% of its revenues into cash flow. This means that, for a given level of sales, KL is able to generate more free cash flow for investors.

Valuation

COLD trades at a forward P/E of 37.85, a P/B of 3.50, and a P/S of 4.18, compared to a P/B of 6.26, and a P/S of 8.46 for KL. Given that earnings are what matter most to investors, analysts tend to place a greater weight on the P/E.

Analyst Price Targets and Opinions

Investors often compare a stock’s current price to an analyst price target to get a sense of the potential upside within the next year. COLD is currently priced at a -10.4% to its one-year price target of 39.79.

Insider Activity and Investor Sentiment

The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the percentage of a stock’s tradable shares currently being shorted, captures what the market as a whole feels about a stock. COLD has a short ratio of 8.91 compared to a short interest of 2.94 for KL. This implies that the market is currently less bearish on the outlook for KL.

Summary

Kirkland Lake Gold Ltd. (NYSE:KL) beats Americold Realty Trust (NYSE:COLD) on a total of 6 of the 13 factors compared between the two stocks. KL is growing fastly, has a higher cash conversion rate and has lower financial risk. Finally, KL has better sentiment signals based on short interest.