Abercrombie Story

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ANF -- USA Stock  

USD 37.81  1.92  4.83%

Macroaxis News
By Vlad Skutelnik  
Macroaxis Story
It looks as if Abercrombie Fitch will continue to recover much faster as its share price surged up 0.91% today. The company current daily volatility is 2.81 percent, with a beta of 0.19 and an alpha of 0.43 over DOW. While some baby boomers are getting worried about saving accounts, it is reasonable to digest Abercrombie Fitch. I will address the reasons why this entity does not get much respect from shareholders under the current market uncertainty.
Published over a month ago
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Should you trade Abercrombie Fitch after the latest volatility surge?
Abercrombie Fitch has roughly 812.88 M in cash with 493.42 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 13.03.
Our investment recommendation module complements current analysts and expert consensus on Abercrombie Fitch. It analyzes the firm potential to grow using all fundamental, technical, and market related data available at the time.
Investing in Abercrombie Fitch, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Abercrombie Fitch along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Abercrombie Fitch's stock price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy. Please use the tools below to analyze the current value of Abercrombie Fitch in the context of predictive analytics.
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Please note, it is not enough to conduct a financial or market analysis of a single entity such as Abercrombie Fitch. Your research has to be compared to or analyzed against Abercrombie Fitch's peers to derive any actionable benefits. When done correctly, Abercrombie Fitch's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy towards taking a position in Abercrombie Fitch.

How important is Abercrombie Fitch's Liquidity

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

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Abercrombie Fitch, but it might be worth checking our own buy vs. sell analysis

Abercrombie Fitch Correlation with Peers

Investors in Abercrombie can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Abercrombie Fitch. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Abercrombie Fitch and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Abercrombie is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage.
Please check volatility of Abercrombie for more details

Breaking it down a bit more

Abercrombie Fitch appears to be not too volatile, given 1 month investment horizon. Abercrombie Fitch secures Sharpe Ratio (or Efficiency) of 0.18, which signifies that the company had 0.18% of return per unit of standard deviation over the last month. Our philosophy in foreseeing the volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. By analyzing Abercrombie Fitch technical indicators you can presently evaluate if the expected return of 0.51% is justified by implied risk. Please makes use of Abercrombie Fitch mean deviation of 2.39, and Risk Adjusted Performance of 0.1212 to double-check if our risk estimates are consistent with your expectations.
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0.430.07-0.070.57
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0.43-0.240.320.86
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Click cells to compare fundamentals   Check Volatility   Backtest Portfolio

Abercrombie showing appearance of lower volatility

Latest downside variance is at 8.52. Abercrombie Fitch currently demonstrates below-average downside deviation. It has Information Ratio of 0.12 and Jensen Alpha of 0.43. However, we advise investors to further question Abercrombie Fitch expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Abercrombie Fitch'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 Abercrombie Fitch'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.

The Bottom Line

Although many other companies within the apparel retail industry are still a little expensive, even after the recent corrections, Abercrombie Fitch may offer a potential longer-term growth to shareholders. All things considered, as of the 2nd of March 2021, our final 30 days Buy-Hold-Sell recommendation on the firm is Strong Hold. We believe Abercrombie Fitch is currently overvalued with low probability of distress for the next two years.

About Contributor

Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, predictive investment analytics, and risk management. View Profile
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 Abercrombie Fitch. Please refer to our Terms of Use for any information regarding our disclosure principles.

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