Thinking to buy more of ABIOMED?

In spite of rather sound fundamental drivers, ABIOMED is not utilizing all of its potentials. The continuing stock price tumult, may contribute to shorter-term losses for the shareholders. ABIOMED shows prevailing Real Value of $198.73 per share. The current price of the entity is $270.39. At this time the entity appears to be overvalued. Macroaxis approximates value of ABIOMED from evaluating the entity fundamentals such as Profit Margin of 33.66%, Current Valuation of 11.26B and Shares Outstanding of 45.12M as well as inspecting its technical indicators and Probability Of Bankruptcy. In general, we favor to go long with undervalued instruments and to trade away overvalued instruments since at some future date assets prices and their ongoing real values will blend.
Published over a year ago
View all stories for ABIOMED | View All Stories
Macroaxis uses a strict editorial review process to publish stories and blog posts. Our publishers support our company and may receive a small commission when the partner links or references are utilized. Commissions do not affect the opinions or evaluations of our editorial team. The information our editors and media partners deliver is confidential and licensed for your sole use as a Macroaxis user. We reserve all rights to the content of this article, and therefore copying or distributing this story in whole or in part is strictly prohibited.

Reviewed by Michael Smolkin

The company currently holds zero balance in liabilities with Debt to Equity (D/E) ratio of 2.6 implying the stock greatly relies on financing operations through barrowing. ABIOMED has Current Ratio of 6.26 suggesting that it is liquid enough and is able to pay its financial obligations when they are due. This firm dividends can provide a clue to current valuation of the stock. ABIOMED is not expected to issue dividends this year as it trying to preserve or re-invest any of the funds available for distribution to stakeholders. The company has Profit Margin (PM) of 33.66 % which can be a sign that it executes well on its competitive strategies and has a good control over its expenditures. This is very large. Similarly, it shows Operating Margin (OM) of 29.22 % which suggests for every 100 dollars of sales it generated a net operating income of 0.29.
Typically, a company's financial statements are the reports that show the financial position of the company. There are three main documents that fall into the category of financial statements. These documents include ABIOMED income statement, its balance sheet, and the statement of cash flows. Potential ABIOMED investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although ABIOMED investors may use each financial statement separately, they are all related. The changes in ABIOMED's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on ABIOMED's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
The goal of ABIOMED fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of ABIOMED performance into the future periods or doing a reasonable stock valuation. The intrinsic value of ABIOMED shares is the value that is considered the true value of the share. If the intrinsic value of ABIOMED is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares ABIOMED. Please read more on our fundamental analysis page.

Watch out for price decline

Please consider monitoring ABIOMED on a daily basis if you are holding a position in it. ABIOMED is trading at a penny-stock level, and the possibility of delisting is much higher compared to other delisted stocks. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion. Most exchanges require public instruments, such as ABIOMED stock to be traded above the $1 level to remain listed. If ABIOMED stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.

How important is ABIOMED's Liquidity

ABIOMED financial leverage refers to using borrowed capital as a funding source to finance ABIOMED ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. ABIOMED 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. Financial leverage can amplify the potential profits to ABIOMED's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of ABIOMED's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between ABIOMED's total debt and its cash.

Breaking it down

The entity has beta of 1.13. ABIOMED returns are very sensitive to returns on the market. As market goes up or down, ABIOMED is expected to follow. The small decline in market price for the last few months could raise concerns from investors as the entity closed today at a share price of 262.83 on 695368.000 in volume. The company executives did not add much value to ABIOMED investors in April. However, diversifying your holdings with ABIOMED or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 30 days (very short) investing horizon is currently 1.9693. The below-average Stock volatility is a good sign for a longer term investment options and for buy-and-hold investors. ABIOMED discloses 769.43m in revenue. ABIOMED is trading at 270.39. This is 2.95 percent increase. Day Low was 262.83. ABIOMED Net Cash Flow Investment Acquisitions and Disposals is decreasing over the last 5 years. The previous year value of ABIOMED Net Cash Flow Investment Acquisitions and Disposals was 30,037,218. Further, ABIOMED Revenues USD is rather stable at the moment.
Revenues USDRevenues
 2013 0.00  0.00 
 2014 0.00  0.00 
 2015 0.00  0.00 
 2018 0.00  0.00 
 2019 (projected) 0.00  0.00 
To sum up, our research shows that ABIOMED is very steady with below average odds of financial turmoil in the next two years. Our present buy or sell advice on the firm is Hold.

Building efficient market-beating portfolios requires time, education, and a lot of computing power!

The Portfolio Architect is an AI-driven system that provides multiple benefits to our users by leveraging cutting-edge machine learning algorithms, statistical analysis, and predictive modeling to automate the process of asset selection and portfolio construction, saving time and reducing human error for individual and institutional investors.

Try AI Portfolio Architect

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of ABIOMED. Please refer to our Terms of Use for any information regarding our disclosure principles.

Would you like to provide feedback on the content of this article?

You can get in touch with us directly or send us a quick note via email to editors@macroaxis.com