Cubic has a beta of 0.6151. Let's try to break down what Cubic's beta means in this case. Cubic returns are very sensitive to returns on the market. As the market goes up or down, Cubic is expected to follow. The beta indicator helps investors understand whether Cubic moves in the same direction as the rest of the market, and how volatile (i.e., risky) it is compared to the market (i.e., selected benchmark). In other words, if Cubic deviates very little from the market, it does not add much risk to the portfolio, but it also doesn't increase the expected returns.
How important is Cubic's Liquidity
Cubic
financial leverage refers to using borrowed capital as a funding source to finance Cubic ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Cubic 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 Cubic'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 Cubic'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 Cubic's total debt and its cash.
Detailed Outlook On Cubic
The current price rise of Cubic could raise concerns from investors as the firm it trading at a share price of
65.58 on
356,455 in volume. The company management teams may have good odds in positioning the firm resources to exploit market volatility in
December. The stock standard deviation of daily returns for 30 days investing horizon is currently 4.88. This high volatility is attributed to the latest market swings and not so good earnings reports for some of the Cubic partners.
Margin Breakdown
| Operating Margin | 4.99 |
| EBITDA Margin | 0.0805 |
| Gross Margin | 0.33 |
| Profit Margin | 0.0288 |
Will price continue to rise in December 2020?
Sortino ratio is down to 0.23. It may suggest a possible volatility slip. Cubic currently demonstrates below-verage downside deviation. It has Information Ratio of 0.11 and Jensen Alpha of 0.58. However, we do advice investors to further question Cubic expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.
Our Conclusion on Cubic
Whereas some firms under the aerospace & defense industry are still a bit expensive, Cubic may offer a potential longer-term growth to investors. With a less-than optimistic outlook for your 30 days horizon, it may be a good time to exit some or all of your Cubic holdings as it seems the potential growth was already fully factored into the current price. 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 Cubic.
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Gabriel Shpitalnik is a Member of Macroaxis Editorial Board. Gabriel is a young entrepreneur and writes predominantly on the business, technology, and finance sector. He likes to analyze different equity instruments across a wide range of industries focusing primarily on consumer products and evolving technologies.
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 Gabriel Shpitalnik do not own shares of Cubic. Please refer to our
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