This firm currently holds 138
M in liabilities with Debt to Equity (D/E) ratio of 0.36, which is about average as compared to similar companies. The company has a current ratio of 3.47, suggesting that it is liquid enough and is able to pay its financial obligations when due. Debt can assist Appharvest until it has trouble settling it off, either with new capital or with free cash flow. So, Appharvest's shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Appharvest sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Appharvest to invest in growth at high rates of return. When we think about Appharvest's use of debt, we should always consider it together with cash and equity.
The firm shows a Beta (market volatility) of 1.2665, which signifies a somewhat significant risk relative to the market. Let's try to break down what Appharvest'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, Appharvest will likely underperform. Although it is extremely important to respect
Appharvest historical returns, it is better to be realistic regarding the information on equity current trending patterns. The philosophy towards 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
Appharvest technical indicators, you can presently evaluate if the expected return of 0.0229% will be sustainable into the future.
Appharvest right now shows a risk of 7.5%. Please confirm Appharvest
potential upside, and the
relationship between the
sortino ratio and
skewness to decide if Appharvest will be following its
price patterns.
Volatility is a rate at which the price of AppHarvest 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 AppHarvest may increase or decrease. In other words, similar to AppHarvest's
beta indicator, it measures the risk of AppHarvest and helps estimate the fluctuations that may happen in a short period of time. So if prices of AppHarvest 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.
Watch out for price decline
Please consider monitoring AppHarvest on a daily basis if you are holding a position in it. AppHarvest 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 AppHarvest stock to be traded above the $1 level to remain listed. If AppHarvest 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 AppHarvest's Liquidity
AppHarvest
financial leverage refers to using borrowed capital as a funding source to finance AppHarvest ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. AppHarvest 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 AppHarvest'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 AppHarvest'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 AppHarvest's total debt and its cash.
Going after AppHarvest Financials
Appharvest reported the previous year's revenue of 9.05
M. Net Loss for the year was (166.19
M) with loss before overhead, payroll, taxes, and interest of (32.89
M).
Our perspective of the current Appharvest rise
Value At Risk just dropped to -9.46, may hint to upcoming price decrease.
As of the 28th of May, Appharvest shows the Risk Adjusted Performance of 0.081,
downside deviation of 6.58, and Mean Deviation of 5.99. Appharvest
technical analysis gives you the methodology to make use of
historical prices and volume patterns to determine a pattern that approximates the direction of the firm's future prices. Put another way, you can use this information to find out if the firm will indeed mirror its model of
historical prices and volume momentum, or the prices will eventually revert. We were able to interpolate data for nineteen
technical drivers for Appharvest, which can be compared to its rivals. Please confirm
Appharvest jensen alpha, as well as the
relationship between the potential upside and
skewness to decide if Appharvest is priced correctly, providing market reflects its regular price of 3.26 per share. Given that Appharvest has
jensen alpha of 0.4062, we suggest you to validate Appharvest's prevailing market performance to make sure the company can sustain itself at a future point.
Our Bottom Line On Appharvest
When is the right time to buy or sell Appharvest? Buying stocks such as Appharvest isn't very hard. However, what challenging for most investors is doing it at the right time. Proper
market timing is something most people cannot do without
sophisticated tools, which help to isolate the right opportunities, deliver winning trades and diversify portfolios on a daily basis.
With a somewhat neutral outlook on your 90 days horizon, it may be better to hold off any trading activity and neither pick up new shares of Appharvest nor drop your existing holdings in the Stock. It seems the expected volatility has not yet been fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Appharvest.
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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 AppHarvest. Please refer to our
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