Babcock Story

<div class='circular--portrait' style='background:#9CBEFD;color: #ffffff;font-size:4em;'>BW</div>
BW -- USA Stock  

USD 7.15  0.29  3.90%

It appears Babcock Wilcox will continue to recover much faster as its share price surged up 6.66% today. The firm current daily volatility is 5.63 percent, with a beta of 1.67 and an alpha of 0.74 over DOW. While some millenniums are indifferent towards aggressive defence, it makes sense to focus on Babcock Wilcox Enterprises. We will evaluate if Babcock Wilcox shares are reasonably priced going into April.
Published over a month ago
View all stories for Babcock Wilcox | View All Stories
Is Babcock Wilcox (NYSE:BW) way too risky for millennials?
The company is active under Industrials sector as part of Electrical Equipment & Parts industry. Babcock Wilcox Enter reports 396.35 M of total liabilities with total debt to equity ratio (D/E) of 360.7, which implies that Babcock Wilcox may not be able to produce enough cash to satisfy its debt commitments. The entity has a current ratio of 1.39, which is generally considered normal.
Investing in Babcock Wilcox, 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 Babcock Wilcox 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 Babcock Wilcox'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 Babcock Wilcox in the context of predictive analytics.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Babcock Wilcox. Your research has to be compared to or analyzed against Babcock Wilcox's peers to derive any actionable benefits. When done correctly, Babcock Wilcox'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 Babcock Wilcox Enter.

How important is Babcock Wilcox's Liquidity

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

How Babcock utilizes its cash?

To perform a cash flow analysis of Babcock Wilcox, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Babcock Wilcox is receiving and how much cash it distributes out in a given period. The Babcock Wilcox cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Babcock Wilcox Net Cash Flow from Operations is fairly stable at the moment as compared to the past year. Babcock Wilcox reported Net Cash Flow from Operations of (40.81 Million) in 2020

Babcock Wilcox Correlation with Peers

Investors in Babcock can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Babcock Wilcox Enterprises. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Babcock Wilcox and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Babcock 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 Babcock for more details

Another Outlook On Babcock Wilcox

Babcock Wilcox appears to be slightly risky, given 1 month investment horizon. Babcock Wilcox Enter secures Sharpe Ratio (or Efficiency) of 0.16, which signifies that the company had 0.16% 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 Babcock Wilcox Enter technical indicators you can presently evaluate if the expected return of 0.89% is justified by implied risk. Please makes use of Babcock Wilcox Enter risk adjusted performance of 0.1427, and Mean Deviation of 4.21 to double-check if our risk estimates are consistent with your expectations.
BE
BW
KE
EOSE
EXDI
BE
0.390.310.740.39
BE
BW
0.390.910.230.91
BW
KE
0.310.910.310.86
KE
EOSE
0.740.230.310.31
EOSE
EXDI
0.390.910.860.31
EXDI
BE
BW
KE
EOSE
EXDI
Click cells to compare fundamentals   Check Volatility   Backtest Portfolio

Will Babcock Wilcox latest climb continue?

Market risk adjusted performance is down to 0.55. It may cause a possible volatility fall. Babcock Wilcox Enterprises exhibits above-average semi-deviation for your current time horizon. We encourage investors to investigate Babcock Wilcox Enterprises individually to make sure intended market timing strategies and available technical indicagtors are consistent with their estimates about Babcock Wilcox future systematic risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Babcock Wilcox'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 Babcock Wilcox'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 Takeaway on Babcock Wilcox Investment

While few other entities under the electrical equipment & parts industry are still a bit expensive, Babcock Wilcox may offer a potential longer-term growth to sophisticated investors. Taking everything into account, as of the 9th of March 2021, our research shows that Babcock Wilcox is a rather slightly risky investment opportunity with a below average odds of financial turmoil in the next two years. From a slightly different view, the entity currently appears to be undervalued. Our latest 30 days advice on the venture is Hold.

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 Ellen Johnson do not own shares of Babcock Wilcox Enterprises. Please refer to our Terms of Use for any information regarding our disclosure principles.

Would you like to provide feedback on the content of this article?

You can get in touch with us directly or send us a quick note via email to editors@macroaxis.com