Azek Story

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AZEK -- USA Stock  

USD 41.23  0.10  0.24%

As many investors are getting excited about industrials space, Azek and Quanex Building may be going in opposite directions. We are going to concentrate on some of the competitive aspects of both Azek and Quanex.
Published over a month ago
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Should we be purchasing Quanex or Azek?
By analyzing existing basic indicators between Azek and Quanex, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Quanex with a short position in Azek. Check out our pair correlation module for more information.

Let's begin by analyzing the assets. The concept of asset utilization usually refers to the revenue earned for every dollar of assets a company currently reports. The recent return on assets of Azek signifies not a very effective usage of assets in December.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as Azek or Quanex is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

How important is Azek's Liquidity

Azek financial leverage refers to using borrowed capital as a funding source to finance The Azek Company ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Azek 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 Azek'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 Azek, but it might be worth checking our own buy vs. sell analysis

Correlation Between Azek and Quanex Building Prod

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Azek together with similar or unrelated positions with a negative correlation. For example, you can also add Quanex Building to your portfolio. If Quanex Building is not perfectly correlated to Azek it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Azek for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down. Please check pair correlation details between AZEK and NX for more information.

Note

Are you currently holding both Azek and Quanex Building in your portfolio? Please note if you are using this as a pair-trade strategy between Azek and Quanex Building, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses.

Breaking down Azek Indicators

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Lets now check Azek revenue. Based on the latest financial disclosure, The Azek Company reported 850.87 M of revenue. This is 75.68% lower than that of the Industrials sector and significantly higher than that of the Building Products & Equipment industry. The revenue for all United States stocks is 90.98% higher than that of Azek. As for Quanex Building we see revenue of 836.54 M, which is much higher than that of the Building Products & Equipment

Azek850.87 Million
Sector0.0
Quanex836.54 Million
850.9 M
Azek
Sector
836.5 M
Quanex

Is Azek showing sign of lower volatility?

Total Risk Alpha just dropped to -0.28, may signify upcoming price decrease. The Azek Company exhibits very low volatility with skewness of -0.84 and kurtosis of 1.69. However, we advise investors to further study The Azek Company technical indicators to make sure all market info is available and is reliable.

Our Conclusion on Azek

Although other companies in the building products & equipment industry are either recovering or due for a correction, Azek may not be performing as strong as the other in terms of long-term growth potentials. With a relatively neutral outlook on the recent economy, it is better to hold off any trading of Azek 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 Azek.

About Contributor

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 Raphi Shpitalnik do not own shares of The Azek Company. Please refer to our Terms of Use for any information regarding our disclosure principles.

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