D S Story

DSPG -- USA Stock

USD 15.57 0.26 1.70%

Macroaxis Story

It looks like EMCORE will be up for a correction way faster as its share price whent up 15.68% today to DSP's 3.8369%. As many of us are excited about technology space, we will review both, DSP and EMCORE as a potential shorter-term opportunity. We are going to discuss some of the competitive aspects of both DSP and EMCORE.

Published over two weeks ago

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Will DSP (NASDAQ:DSPG) shareholders shift to EMCORE (NASDAQ:EMKR)?

By analyzing existing technical and fundamental indicators between DSP and EMCORE, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in EMCORE with a short position in DSP. Check out our pair correlation module for more information.

Let's begin by analyzing the assets. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. DSP has an asset utilization ratio of 60.81 percent. This indicates that the company is making $0.61 for each dollar of assets. An increasing asset utilization means that DSP Group is more efficient with each dollar of assets it utilizes for everyday operations.

Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as D S or Magnachip is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

How important is D S's Liquidity

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

Correlation Between D S and Magnachip Semiconductor

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding D S together with similar or unrelated positions with a negative correlation. For example, you can also add Magnachip Semiconductor to your portfolio. If Magnachip Semiconductor is not perfectly correlated to D S it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When D S for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.

Please check pair correlation details between DSPG and MX for more information.

Note

Are you currently holding both D S and Magnachip Semiconductor in your portfolio?

Please note if you are using this as a pair-trade strategy between D S and Magnachip Semiconductor, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses.

Is D S valued correctly by the market?

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Let me now analyze DSP revenue. Based on the latest financial disclosure, DSP Group reported 111.86 M of revenue. This is 97.26% lower than that of the Technology sector and 97.96% lower than that of the Semiconductors industry. The revenue for all United States stocks is 98.81% higher than that of the firm. As for EMCORE we see revenue of 110.13 M, which is 97.99% lower than that of the Semiconductors

Sector

4.1 B

DSPG	111.86 Million	2.6
Sector	4.08 Billion	94.83
EMKR	110.13 Million	2.56

Can DSP build up on the latest surge?

Potential upside is down to 3.51. It may indicate a possible volatility dip. DSP Group currently demonstrates below-verage downside deviation. It has Information Ratio of 0.05 and Jensen Alpha of 0.09. However, we do advice investors to further question DSP Group expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

Although some companies under the semiconductors industry are still a bit expensive, DSP may offer a potential longer-term growth to shareholders. In closing, as of the 4th of February 2021, we see that DSP almost mirrors the market. The firm is undervalued with very small chance of distress within the next 24 months. Our overall 30 days advice on the firm is Buy.

About Contributor

Raphi Shpitalnik is a Junior Member of Macroaxs Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time base at the beginning of the pandemic and eventually acquired a real test 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 D S P. Please refer to our Terms of Use for any information regarding our disclosure principles.

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