Aehr Test Story

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AEHR -- USA Stock  

USD 2.08  0.04  1.89%

Given the investment horizon of 60 days Aehr Test is expected to generate 7.73 times more return on investment than the market. However, the company is 7.73 times more volatile than its market benchmark. It trades about 0.03 of its potential returns per unit of risk. The DOW is currently generating roughly 0.16 per unit of risk. While many risk-averse retail investors are getting carried away by overanalyzing technology space, it is reasonable to sum up Aehr Test Systems. We will discuss why it could be a different year for Aehr Test shareholders.
Published over three weeks ago
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Should you exit Aehr Test (NASDAQ:AEHR) after the latest volatility spike?
Aehr Test Systems currently holds roughly 3.45 M in cash with (4 M) of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 0.15.
Aehr Test has performance score of 2 on a scale of 0 to 100. The firm shows a Beta (market volatility) of 3.3249, which signifies a somewhat significant risk relative to the market. Let's try to break down what Aehr Test's beta means in this case. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Aehr Test will likely underperform. Although it is extremely important to respect Aehr Test Systems historical returns, it is better to be realistic regarding the information on equity current trending patterns. The philosophy in foreseeing future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. By analyzing Aehr Test Systems technical indicators, you can presently evaluate if the expected return of 0.18% will be sustainable into the future. Aehr Test Systems right now shows a risk of 6.53%. Please confirm Aehr Test Systems value at risk, and the relationship between the jensen alpha and skewness to decide if Aehr Test Systems will be following its price patterns.
Volatility is a rate at which the price of Aehr Test 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 Aehr Test may increase or decrease. In other words, similar to Aehr Test's beta indicator, it measures the risk of Aehr Test and helps estimate the fluctuations that may happen in a short period of time. So if prices of Aehr Test 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 Aehr Test's Liquidity

Aehr Test financial leverage refers to using borrowed capital as a funding source to finance Aehr Test Systems ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Aehr Test 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 Aehr Test's total debt and its cash.

How Aehr Test utilizes its cash?

To perform a cash flow analysis of Aehr Test, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Aehr Test is receiving and how much cash it distributes out in a given period. The Aehr Test cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Aehr Test Net Cash Flow from Operations is relatively stable at the moment as compared to the past year. Aehr Test reported last year Net Cash Flow from Operations of (1.82 Million)

Aehr Test Volatility Drivers

Aehr Test unsystematic risk is unique to Aehr Test Systems 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 Aehr Test you can also buy Emagin Corp. You can also mitigate this risk by investing in the semiconductor equipment & materials 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 Aehr Test 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 Aehr Test income statement and balance sheet. Here are more details about Aehr Test volatility.