Planning to stay with Boralex (CA:BLX) in March?

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BLX Stock  CAD 38.90  0.37  0.96%   
Aina Ster
By Aina Ster
Macroaxis Story
While some baby boomers are getting worried about utilities space, it is reasonable to recap Boralex against economic and market trends. As we have suggested previously, Boralex is beginning its decline as insiders shift to be more bearish due to the increased sector volatility. Boralex slowly supersedes the market. The returns on investing in Boralex and the market returns of the last few months appear highly unrelated. Healthy basic indicators of the firm may hint at signs of short-term price drift for insiders. Boralex is scheduled to announce its earnings tomorrow.
Published over three weeks ago
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Reviewed by Rifka Kats

The company's average rating is Buy from 4 analysts. Do analysts base this consensus on technical analyses? We know that typical technical analysis utilizes price momentum, patterns, and trends looking at historical prices. It aims to identify signals based on Boralex market sentiment investors' perception of the future value of Boralex. Let us look at a few aspects of Boralex technical analysis.
Using predictive technical analysis, we will analyze different prices and returns patterns and diagnose historical swings to determine the real value of Boralex. In general, we focus on analyzing Boralex stock price patterns and their correlations with different microeconomic environment and drivers. We also apply predictive analytics to build Boralex's daily price indicators and compare them against related drivers such as momentum indicators and various other types of predictive indicators. Using this methodology combined with a more conventional technical analysis and fundamental analysis, we attempt to find the most accurate representation of Boralex's intrinsic value. In addition to deriving basic predictive indicators for Boralex, we also check how macroeconomic factors affect Boralex price patterns. Please read more on our technical analysis page or use our predictive modules below to complement your research.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Boralex's 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 Boralex in the context of predictive analytics.
Hype
Prediction
Details
Intrinsic
Valuation
Details
Naive
Forecast
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4 Analysts
Consensus
Details
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Boralex. Your research has to be compared to or analyzed against Boralex's peers to derive any actionable benefits. When done correctly, Boralex'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 Boralex.

How important is Boralex's Liquidity

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

How does Boralex utilize its cash?

To perform a cash flow analysis of Boralex, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Boralex is receiving and how much cash it distributes out in a given period. The Boralex cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Boralex Net Cash Flow from Operations is very stable at the moment as compared to the past year. Boralex reported last year Net Cash Flow from Operations of 310.5 Million

Closer look at Boralex Standard Deviation

Boralex has current Standard Deviation of 1.6. The Standard Deviation is a measure of how spread out the prices or returns of an asset are on average. It is the most widely used risk indicator in the field of investing and finance. Standard Deviation is commonly used to measure confidence in statistical conclusions regarding certain equity instruments or portfolios of equities.

Standard deviation is applied to the annual rate of return of an investment to measure the investment's volatility. Standard deviation is also known as historical volatility and is used by investors as a gauge for the amount of expected market volatility. A large standard deviation usually indicates that the data points are far from the mean and a small standard deviation indicates that they are clustered closely around the mean.

Standard Deviation 
=  
SQRT(V) 
 = 
1.6
SQRT = Square root notation
V =   Variance of Boralex returns
Let's now compare Boralex Standard Deviation to its closest peers:
BLX.TO
BEP-PO.TO
NPI.TO
BEPC.TO
IAG.TO
BLX.TO1.6035833989441328
BEP-PO.TO0.66
NPI.TO1.31
BEPC.TO1.78
IAG.TO1.14

Our Boralex analysis suggests possible reversion in March

Boralex recent maximum drawdown upswings over 6.76. Boralex has relatively low volatility with skewness of -0.26 and kurtosis of -0.03. However, we advise all investors to independently investigate Boralex to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Boralex's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Boralex'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.

Our Conclusion on Boralex

Although other entities in the utilities—renewable industry are either recovering or due for a correction, Boralex may not be performing as strong as the other in terms of long-term growth potentials. To summarize, as of the 23rd of February 2023, our analysis shows that Boralex slowly supersedes the market. The firm is overvalued and projects close to average probability of distress for the next 2 years. Our primary 90 days buy-hold-sell recommendation on the firm is Cautious Hold.

Editorial Staff

Aina Ster is a Member of Macroaxis Editorial Board. Aina delivers weekly perspective on ongoing market and economic trends, analysis and tips from predictive analysis to forecasting across various financial instruments. 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 Aina Ster do not own shares of Boralex. Please refer to our Terms of Use for any information regarding our disclosure principles.

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