Breaking down ABM Industries volatility

ABM Stock  USD 45.85  0.08  0.17%   
Considering the 90-day investment horizon ABM Industries is expected to generate 1.51 times more return on investment than the market. However, the company is 1.51 times more volatile than its market benchmark. It trades about 0.08 of its potential returns per unit of risk. The Dow Jones Industrial is currently generating roughly 0.09 per unit of risk. While some risk-loving traders are indifferent towards current market volatility, it is reasonable to summarize the risk of investing in ABM Industries Incorporated. We will summarize if the expected returns on ABM Industries will justify its current volatility.
Published over a month ago
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ABM Industries Incorporated has roughly 62.8 M in cash with 314.3 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 0.97.
Volatility is a rate at which the price of ABM Industries or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of ABM Industries may increase or decrease. In other words, similar to ABM Industries's beta indicator, it measures the risk of ABM Industries and helps estimate the fluctuations that may happen in a short period of time. So if prices of ABM Industries fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.

How important is ABM Industries's Liquidity

ABM Industries financial leverage refers to using borrowed capital as a funding source to finance ABM Industries Incorporated ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. ABM Industries financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between ABM Industries's total debt and its cash.

How does ABM Industries utilize its cash?

To perform a cash flow analysis of ABM Industries, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash ABM Industries is receiving and how much cash it distributes out in a given period. The ABM Industries cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
ABM Industries Net Cash Flow from Operations is relatively stable at the moment as compared to the past year. The company's current value of Net Cash Flow from Operations is estimated at 13.2 Million

ABM Industries Volatility Drivers

ABM Industries unsystematic risk is unique to ABM Industries Incor and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in ABM Industries you can also buy Gartner. You can also mitigate this risk by investing in the industrials sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing ABM Industries important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in ABM Industries income statement and balance sheet. Here are more details about ABM Industries volatility.
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