Chemocentryx Stock Story

CCXI
 Stock
  

USD 50.72  0.12  0.24%   

Chemocentryx is currently does not generate positive expected returns and assumes 5.1626% risk (volatility on return distribution) over the 90 days horizon. While many risk-averse stockholders are getting carried away by overanalyzing healthcare space, it is reasonable to concentrate on Chemocentryx. We will examine if the expected returns on Chemocentryx will justify its current volatility.
Published over two months ago
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Chemocentryx (NASDAQ:CCXI) high volatility trend continues

Chemocentryx currently holds 72.95 M in liabilities with Debt to Equity (D/E) ratio of 0.23, which may suggest the entity is not taking enough advantage from borrowing. This firm has a current ratio of 4.79, suggesting that it is liquid enough and is able to pay its financial obligations when due. Debt can assist Chemocentryx until it has trouble settling it off, either with new capital or with free cash flow. So, Chemocentryx'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 Chemocentryx sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Chemocentryx to invest in growth at high rates of return. When we think about Chemocentryx's use of debt, we should always consider it together with cash and equity.
The firm shows a Beta (market volatility) of 1.3409, which signifies a somewhat significant risk relative to the market. Let's try to break down what Chemocentryx'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, Chemocentryx will likely underperform. Even though it is essential to pay attention to Chemocentryx 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. Chemocentryx exposes twenty-eight different technical indicators, which can help you to evaluate its performance. Chemocentryx has an expected return of -0.57%. Please be advised to confirm Chemocentryx maximum drawdown, and the relationship between the information ratio and expected short fall to decide if Chemocentryx performance from the past will be repeated at some point in the near future.
Volatility is a rate at which the price of Chemocentryx 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 Chemocentryx may increase or decrease. In other words, similar to Chemocentryx's beta indicator, it measures the risk of Chemocentryx and helps estimate the fluctuations that may happen in a short period of time. So if prices of Chemocentryx 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.

How important is Chemocentryx's Liquidity

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

How does Chemocentryx utilize its cash?

To perform a cash flow analysis of Chemocentryx, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Chemocentryx is receiving and how much cash it distributes out in a given period. The Chemocentryx cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Chemocentryx Net Cash Flow from Operations is most likely to decrease significantly in the upcoming years. The last year's value of Net Cash Flow from Operations was reported at (75.62 Million)

Chemocentryx Volatility Drivers

Chemocentryx unsystematic risk is unique to Chemocentryx and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Chemocentryx you can also buy Regeneron Pharmaceuticals. You can also mitigate this risk by investing in the biotechnology sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Chemocentryx important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Chemocentryx income statement and balance sheet. Here are more details about Chemocentryx volatility.
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