The firm shows a Beta (market volatility) of 0.7767, which signifies possible diversification benefits within a given portfolio. Let's try to break down what Arco Platform's beta means in this case. As returns on the market increase, Arco Platform returns are expected to increase less than the market. However, during the bear market, the loss on holding Arco Platform will be expected to be smaller as well. Even though it is essential to pay attention to
Arco Platform Limited historical returns, it is always good to be careful when utilizing equity current trending patterns. Our philosophy in foreseeing any stock's
future performance is to check both, its past performance charts as well as the business as a whole, including all available
technical indicators. Arco Platform Limited exposes twenty-one different technical indicators, which can help you to evaluate its performance.
Arco Platform Limited has an expected return of -0.12%. Please be advised to confirm Arco Platform Limited
jensen alpha,
semi variance, and the
relationship between the
standard deviation and
value at risk to decide if
Arco Platform Limited stock performance from the past will be repeated at some point in the near future.
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 Arco Platform income statement, its balance sheet, and the statement of cash flows. Potential Arco Platform investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although Arco Platform investors may use each financial statement separately, they are all related. The changes in Arco Platform's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Arco Platform'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 Arco Platform
fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of Arco Platform performance into the future periods or doing a reasonable stock valuation. The intrinsic value of Arco Platform shares is the value that is considered the true value of the share. If
the intrinsic value of Arco 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 Arco Platform. Please read more on our
fundamental analysis page.
How important is Arco Platform's Liquidity
Arco Platform
financial leverage refers to using borrowed capital as a funding source to finance Arco Platform ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Arco Platform 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 Arco Platform'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 Arco Platform'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 Arco Platform's total debt and its cash.
Is Arco Platform valued correctly by the market?
Many companies such as Arco Platform have both institutions investors and insiders sharing the ownership. Retail investors typically buy and sell stocks in round lots of 100 shares or more. Other other hand institutional investors are known to buy and sell in block trades of 10,000 shares or more. Let's take a look at how the ownership of Arco Platform is distributed among investors.
Ownership Allocation
Arco Platform Limited retains a total of 27.54 Million outstanding shares. The majority of Arco Platform Limited
outstanding shares are owned by
other corporate entities. These outside corporations are usually referred to as non-private investors looking to acquire positions in Arco Platform Limited to benefit from reduced commissions. Consequently, institutional investors are subject to a different set of regulations than regular investors in Arco Platform. Please pay attention to any change in the institutional holdings of Arco Platform Limited as this could imply that something significant has changed or about to change at the company. Also note that nearly one million one hundred one thousand six hundred invesors are currently shorting Arco Platform expressing very little confidence in its
future performance.
| Retail Investors | -4.41 |
| Insiders | 1.48 |
| Institutions | 102.93 |
Asset Utilization
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Arco Platform has an asset utilization ratio of 37.97 percent. This indicates that the company is making $0.38 for each dollar of assets. An increasing asset utilization means that Arco Platform Limited is more efficient with each dollar of assets it utilizes for everyday operations.
| Assets Non Current2.3 B | Goodwill2 B | |
| Current Assets | 887.1 Million | 16.62 |
| Assets Non Current | 2.3 Billion | 43.12 |
| Goodwill | 1.95 Billion | 36.63 |
| Tax Assets | 193.1 Million | 3.62 |
Analysis of Arco Platform Limited
The total risk alpha is down to -0.57 as of today. As of the 16th of August 2020, Arco Platform shows the
risk adjusted performance of 0.0123, and Mean Deviation of 2.31. Arco Platform Limited
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 analyze nineteen
technical drivers for Arco Platform Limited, which can be compared to its rivals. Please confirm
Arco Platform Limited jensen alpha,
semi variance, and the
relationship between the
standard deviation and
value at risk to decide if Arco Platform Limited is priced correctly, providing market reflects its regular price of 46.37 per share. Given that Arco Platform has
jensen alpha of
(0.21), we suggest you to validate Arco Platform Limited's prevailing market performance to make sure the company can sustain itself at a future point.
Although many of the other players in the education & training services industry are either recovering or due for a correction, Arco Platform may not be performing as strong as the other in terms of long-term growth potentials. With a relatively neutral outlook on the latest economy, it is better to hold off any trading of Arco Platform as the current risk-reward utility is not appealing enough. 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 Arco Platform.
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Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce.
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 Rifka Kats do not own shares of Arco Platform. Please refer to our
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