The company has a beta of 2.6864. Let's try to break down what Desktop's beta means in this case. As returns on the market increase, Desktop Metal returns are expected to increase less than the market. However, during the bear market, the loss on holding Desktop Metal will be expected to be smaller as well. The beta indicator helps investors understand whether Desktop Metal 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 Desktop deviates very little from the market, it does not add much risk to the portfolio, but it also doesn't increase the expected returns.
There are currently many different techniques concerning forecasting the market as a whole as well as
predicting future values of individual securities such as Desktop Metal. Regardless of method or technology, to accurately forecast the stock market is more a matter of luck rather than a particular technique. Nevertheless, trying to predict the stock market accurately is still an essential part of the overall investment decision process. Using different forecasting techniques and comparing the results might improve your chances of accuracy even though unexpected events may often change the
market sentiment and impact your forecasting results.
Predictive Modules for Desktop Metal
Sophisticated investors, who have witnessed
many market ups and downs, anticipate that the market will even out over time. This tendency of Desktop Metal'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 note, it is not enough to conduct a financial or market analysis of a single entity such as Desktop Metal. Your research has to be compared to or analyzed against Desktop Metal's peers to derive any actionable benefits. When done correctly, Desktop Metal's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy toward taking a position in Desktop Metal.
Watch out for price decline
Please consider monitoring Desktop Metal on a daily basis if you are holding a position in it. Desktop Metal is trading at a penny-stock level, and the possibility of delisting is much higher compared to other stocks. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion.
Most exchanges require public instruments, such as Desktop Metal stock to be traded above the $1 level to remain listed. If Desktop Metal stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.
How important is Desktop Metal's Liquidity
Desktop Metal
financial leverage refers to using borrowed capital as a funding source to finance Desktop Metal ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Desktop Metal 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 Desktop Metal'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 Desktop Metal'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 Desktop Metal's total debt and its cash.
Desktop Metal Gross Profit
Desktop Metal Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Desktop Metal previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Desktop Metal Gross Profit growth over the last 10 years. Please check Desktop Metal's
gross profit and other
fundamental indicators for more details.
Breaking it down
Desktop Metal is displaying above-average volatility over the selected time horizon. Investors should scrutinize Desktop Metal independently to ensure intended market timing strategies are aligned with expectations about Desktop Metal volatility. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Desktop Metal'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 Desktop Metal'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.
Desktop Metal Implied Volatility
Desktop Metal's implied volatility exposes the market's sentiment of Desktop Metal stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Desktop Metal's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Desktop Metal stock will not fluctuate a lot when Desktop Metal's options are near their expiration.
Returns Breakdown
| Return on Assets | (0.24) |
| Return on Equity | (0.26) |
| Return Capital | (0.84) |
| Return on Sales | (2.48) |
Another 3 percent hike for Desktop Metal
New potential upside is at 13.67.
As of the 15th of June 2022, Desktop Metal shows the
mean deviation of 5.9, and Coefficient Of Variation of
(2,751). Desktop Metal
technical analysis allows you to utilize
historical prices and volume patterns in order to determine a pattern that computes the direction of the firm's future prices. Put another way, you can use this information to find out if the firm will indeed mirror its model of
historical prices and volume momentum, or the prices will eventually revert. We have collected data for nineteen
technical drivers for Desktop Metal, which can be compared to its rivals. Please confirm
Desktop Metal variance,
maximum drawdown, as well as the
relationship between the Maximum Drawdown and
semi variance to decide if Desktop Metal is priced favorably, providing market reflects its regular price of 2.03 per share. Please also check Desktop Metal
total risk alpha, which is currently at 0.5412 to verify the company can sustain itself at a future point.
Our Conclusion on Desktop Metal
While some other entities in the computer hardware industry are either recovering or due for a correction, Desktop Metal may not be performing as strong as the other in terms of long-term growth potentials. The bottom line, as of the 15th of June 2022, our analysis shows that Desktop Metal hyperactively responds to market trends. The company is
undervalued and projects
very small chance of financial distress for the next 2 years. Our primary 90 days 'Buy-Sell' recommendation on the company is
Strong Hold.
Building efficient market-beating portfolios requires time, education, and a lot of computing power!
The Portfolio Architect is an AI-driven system that provides multiple benefits to our users by leveraging cutting-edge machine learning algorithms, statistical analysis, and predictive modeling to automate the process of asset selection and portfolio construction, saving time and reducing human error for individual and institutional investors.
Try AI Portfolio ArchitectEditorial Staff
Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time basis at the beginning of the pandemic and eventually acquired a real taste for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI.
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 Raphi Shpitalnik do not own shares of Desktop Metal. 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