Novan Stock Buy Hold or Sell Recommendation

NOVN
 Stock
  

USD 2.33  0.03  1.30%   

Given the investment horizon of 90 days and your above-average risk tolerance, our recommendation regarding Novan Inc is 'Hold'. Macroaxis provides Novan buy-hold-or-sell recommendation only in the context of selected investment horizon and investor attitude towards risk assumed by holding Novan positions. The advice algorithm takes into account all of Novan's available fundamental, technical, and predictive indicators you will find on this site.
  
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The advice is provided from Novan's buy-and-hold perspective. Additionally, see Novan Analyst Recommendation to compare Macroaxis Buy or Sell Recommendation with the current analyst consensus. To check ratings for multiple equity instruments, please use the Instant Ratings tool. We conduct extensive research on individual companies such as Novan and provide practical buy, sell, or hold advice based on selected investing horizon and risk tolerance towards Novan Inc.

Execute Novan Buy or Sell Advice

The Novan recommendation should be used to complement the buy-or-sell advice compiled from the current analysts' consensus on Novan Inc. Macroaxis does not own or have any residual interests in Novan Inc or other equities on which the buy-or-sell advice is provided. Please provide your input below to execute Novan's advice using the current market data and latest reported fundamentals.

Time Horizon

Risk Tolerance

Execute Advice
Sell NovanBuy Novan
Hold

Volatility

Somewhat reliableDetails

Hype Condition

Under hypedDetails

Current Valuation

UndervaluedDetails

Odds of Distress

Significantly HighDetails

Economic Sensitivity

Responds to the marketDetails

Analyst Consensus

Strong BuyDetails

Financial Strenth (F Score)

FrailDetails

Financial Leverage

InapplicableDetails

Reporting Quality (M-Score)

Unlikely ManipulatorDetails
For the selected time horizon Novan Inc has a Risk Adjusted Performance of (0.22), Jensen Alpha of (0.45), Total Risk Alpha of (0.15) and Treynor Ratio of (0.65)
We provide investment recommendation to complement the last-minute expert consensus on Novan Inc. Our dynamic recommendation engine harnesses a multidimensional algorithm to analyze the entity's potential to grow using all technical and fundamental data available at the time. To make sure Novan Inc is not overpriced, please verify all Novan Inc fundamentals, including its cash per share, as well as the relationship between the short ratio and retained earnings . Please also check out Novan price to book to check your buy or sell decision is consistent with all fundamental data available and that the company can sustain itself in the current economic cycle.

Novan Trading Alerts and Improvement Suggestions

Novan Inc generated a negative expected return over the last 90 days
Novan Inc has high historical volatility and very poor performance
Novan Inc has a very high chance of going through financial distress in the upcoming years
The company reported the previous year's revenue of 2.96 M. Net Loss for the year was (29.69 M) with loss before overhead, payroll, taxes, and interest of (17.71 M).
Novan Inc currently holds about 47.09 M in cash with (24.78 M) of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 2.5, which can makes it an attractive takeover target, given it will continue generating positive cash flow.
Novan Inc has a frail financial position based on the latest SEC disclosures
Latest headline from www.gurufocus.com: Novan Announces Closing of Approximately 15.0 Million Registered Direct Offering Priced At-the-Market - GuruFocus.com

Novan current analysts advice

We track the performance of the top 100 financial experts across various large and mid-size financial boutiques. Novan analyst recommendations are determined by taking all analyst recommendations and averaging them as Strong Buy, Buy, Hold, Strong Sell or Sell. There is no one specific way to measure analysis performance other than comparing it to the past results via a very sophisticated attribution analysis. Novan analyst consensus and target price projections should be used in combination with other traditional techniques such as stock price forecasting, technical analysis, earnings estimate, and various momentum models.
Target Mean Price30.40
Target Median Price30.00
Target High Price41.00
Recommendation Mean2.00
Number Of Analyst Opinions5
Target Low Price17.00
Average Consensus Strong Buy
The consensus estimates and target price estimation comprises individual analyst assessments, and may or may not mutch the Macroaxis buy or sell advice. It is determined by taking an average of all analyst recommendations and classifying them as Strong Buy, Buy, Hold, or Sell.

Novan Returns Distribution Density

The distribution of Novan's historical returns is an attempt to chart the future uncertainty of Novan's future price movements. The chart of the probability distribution of Novan stock daily returns describes the distribution of returns around its average expected value. We use Novan Inc price's Value At Risk and its Upside Potential as a relative measure of the distribution. The graph of the distribution of Novan returns is essential to provide solid investment advice for Novan stock.
Mean Return-0.61Value At Risk-5.71
Potential Upside5.90Standard Deviation3.85
 Return Density 
      Distribution 
Investment risk management requires an estimate of the probability of extreme price changes. Therefore, the correct representation of the distribution of Novan historical returns presented in an easy-to-digest graphical form helps investors and money managers understand the risk-reward trade-off of different investement strategies.

Novan Cash Flow Accounts

201720182019202020212022 (projected)
Capital Expenditure(2.14 M)(1.06 M)(422 K)(126 K)(144.9 K)(156.34 K)
Depreciation Amortization and Accretion1.42 M1.66 M2.03 M1.17 M1.35 M1.38 M
Net Cash Flow or Change in Cash and Cash Equivalents(32.09 M)5.67 M5.52 M21.63 M19.47 M21 M
Issuance Purchase of Equity Shares81 K35.69 M816 K52.06 M59.87 M64.6 M
Issuance Repayment of Debt Securities(166 K)(10 K)(11 K)956 K860.4 K751.79 K
Net Cash Flow from Financing(88 K)35.35 M25.82 M52.81 M44.09 M37.98 M
Net Cash Flow from Investing(2.14 M)(1.06 M)(422 K)(126 K)(7.53 M)(7.73 M)
Net Cash Flow from Operations(29.86 M)(28.62 M)(19.88 M)(31.06 M)(24.78 M)(26.73 M)
Share Based Compensation3.76 M2.2 M1.84 M1.31 M1.5 M1.85 M

Novan Greeks

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Novan or Healthcare sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Novan stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Novan stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
α
Alpha over DOW
-0.45
β
Beta against DOW0.95
σ
Overall volatility
3.78
Ir
Information ratio -0.12

Novan Volatility Alert

Novan Inc exhibits very low volatility with skewness of 0.5 and kurtosis of 1.24. However, we advise investors to further study Novan Inc technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Novan's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Novan's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Novan Implied Volatility

Novan's implied volatility exposes the market's sentiment of Novan Inc stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Novan's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Novan stock will not fluctuate a lot when Novan's options are near their expiration.

Novan Fundamentals Vs Peers

Comparing Novan's fundamentals to the average values of its peers is one of the most widely used and accepted methods of equity analyses. It helps to analyze Novan's direct or indirect competition across all of the common fundamentals between Novan and the related equities. This way, we can detect undervalued stocks with similar characteristics as Novan or determine the stocks which would be an excellent addition to an existing portfolio. Peer analysis of Novan's fundamental indicators could also be used in its relative valuation, which is a method of valuing Novan by comparing valuation metrics with those of similar companies.
    
 Better Than Average     
    
 Worse Than Average Compare Novan to competition
FundamentalsNovanPeer Average
Return On Equity(278.85) %(0.31) %
Return On Asset(32.17) %(0.14) %
Current Valuation37.03 M16.62 B
Shares Outstanding18.82 M571.82 M
Shares Owned by Insiders5.75 %10.09 %
Shares Owned by Institutions13.81 %39.21 %
Number of Shares Shorted479.05 K4.71 M
Price to Earning(1.49) X28.72 X
Price to Book1.70 X9.51 X
Price to Sales15.01 X11.42 X
Revenue2.96 M9.43 B
Gross Profit(17.71 M)27.38 B
EBITDA(29.46 M)3.9 B
Net Income(29.69 M)570.98 M
Cash and Equivalents47.09 M2.7 B
Cash per Share2.50 X5.01 X
Total Debt28.61 M5.32 B
Debt to Equity1.56 %48.70 %
Current Ratio4.86 X2.16 X
Book Value Per Share1.39 X1.93 K
Cash Flow from Operations(24.78 M)971.22 M
Short Ratio3.13 X4.00 X
Earnings Per Share(1.76) X3.12 X
Number of Employees2918.84 K
Beta-0.01-0.15
Market Capitalization44.41 M19.03 B
Total Asset24.5 M29.47 B
Retained Earnings(225.77 M)9.33 B
Working Capital7.02 M1.48 B
Current Asset12.51 M9.34 B
Current Liabilities5.49 M7.9 B
Z Score-15.38.72
   Purchase by Robert Ingram of 50000 shares of Novan [view details]

Novan Market Momentum

Traders often use several daily momentume indicators to supplement a more traditional technical analysis when analyzing securities such as Novan . With many different options, investors must choose the best indicators for them and familiarize themselves with how they work. We suggest combining traditional momentum indicators with more near-term forms of technical analysis such as Accumulation Distribution or Daily Balance Of Power. With their quantitative nature, daily value technical indicators can also be incorporated into your automated trading systems.
Accumulation Distribution1540.73
Daily Balance Of Power0.375
Rate Of Daily Change1.01
Day Median Price2.31
Day Typical Price2.32
Market Facilitation Index0.0
Price Action Indicator0.035

About Novan Buy or Sell Advice

When is the right time to buy or sell Novan Inc? Buying financial instruments such as Novan Stock isn't very hard. However, what challenging for most investors is doing it at the right time to beat the stock market. Proper market timing is something most people cannot do without sophisticated tools, which help to isolate the right opportunities. Macroaxis provides hands-on modules to deliver winning trades and diversify your portfolios on a daily basis. Although Novan investors may find it confusing at the beginning, most of our advising modules are very easy to use and apply.
Please read more on our stock advisor page.
 2020 2021 2022 (projected)
Accounts Payable1.19 M2.17 M1.79 M
Receivables4.86 M4.47 M3.72 M

Use Investing Ideas to Build Portfolios

In addition to having Novan in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Diversified Assets Thematic Idea Now

Diversified Assets
Diversified Assets Theme
Pablicly traded close-end funds and other entities backed by different types of diversified investments. The Diversified Assets theme has 21 constituents.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Diversified Assets Theme or any other thematic opportunities.
View All  Next Launch Diversified Assets
Additionally, see Novan Analyst Recommendation to compare Macroaxis Buy or Sell Recommendation with the current analyst consensus. To check ratings for multiple equity instruments, please use the Instant Ratings tool. Note that the Novan Inc information on this page should be used as a complementary analysis to other Novan's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.

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Is Novan's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Novan. If investors know Novan will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Novan listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
-0.61
Market Capitalization
49.2 M
Quarterly Revenue Growth YOY
1.35
Return On Assets
-0.24
Return On Equity
-10.14
The market value of Novan Inc is measured differently than its book value, which is the value of Novan that is recorded on the company's balance sheet. Investors also form their own opinion of Novan's value that differs from its market value or its book value, called intrinsic value, which is Novan's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Novan's market value can be influenced by many factors that don't directly affect Novan's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Novan's value and its price as these two are different measures arrived at by different means. Investors typically determine Novan value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Novan's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.