Eargo Inc secures Sharpe Ratio (or Efficiency) of -0.13, which denotes the company had -0.13% of return per unit of risk over the last 3 months. Macroaxis standpoint towards predicting the risk of any stock is to look at both systematic and unsystematic factors of the business, including all available market data and
technical indicators. Eargo Inc exposes twenty-seven different
technical indicators, which can help you to evaluate volatility that cannot be
diversified away. Please be advised to confirm Eargo Inc
mean deviation of 6.86, and Coefficient Of Variation of
(714.81) to check the risk estimate we provide.
Typically, a company's
financial statements are the reports that show the
financial position of the company. There are three main documents that fall into the category of financial statements. These documents include EargoInc income statement, its balance sheet, and the statement of cash flows. Potential EargoInc investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although EargoInc investors may use each financial statement separately, they are all related. The changes in EargoInc's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on EargoInc's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our
technical analysis and
fundamental analysis pages.
The goal of EargoInc
fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of EargoInc performance into the future periods or doing a reasonable stock valuation. The intrinsic value of EargoInc shares is the value that is considered the true value of the share. If
the intrinsic value of EargoInc is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares EargoInc. Please read more on our
fundamental analysis page.
How important is EargoInc's Liquidity
EargoInc
financial leverage refers to using borrowed capital as a funding source to finance EargoInc ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. EargoInc 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 EargoInc'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 EargoInc'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 EargoInc's total debt and its cash.
Breaking down EargoInc Indicators
Although in the United States, the Securities and Exchange Commission has enforced strong rules to prevent insiders from engaging in insider trading, finding insiders among active shareholders of Eargo is not uncomon. Many companies such as Eargo have both institutions investors and insiders sharing the ownership. Retail investors typically buy and sell stocks in round lots of 100 shares or more. Other other hand institutional investors are known to buy and sell in block trades of 10,000 shares or more. Let's take a look at how the ownership of Eargo is distributed among investors.
Ownership Allocation
Eargo holds a total of thirty-nine million two hundred sixty thousand
outstanding shares. Over half of Eargo Inc outstanding shares are owned by
other corporate entities. These other corporate entities are typically referred to corporate investors that obtain positions in a given instrument to benefit from reduced trade commissions. Consequently, these
institutions are subject to different rules and regulation than regular investors in Eargo. Please watch out for any change in the
institutional holdings of Eargo Inc as this could mean something significant has changed or about to change at the company. Please note that no matter how much assets the company secures, if the real value of the firm is less than the current market value, you may not be able to make money on it.
| Retail Investors26.88% | Insiders13.66% | Institutions59.46% |
| Retail Investors | 26.88 |
| Insiders | 13.66 |
| Institutions | 59.46 |
Asset Utilization
One of the ways to look at asset utilization of Eargo is to check how much profit was generated for every dollar of assets it reports. Eargo Inc shows a negative utilization of assets of -25.17 percent, losing $0.25 for each dollar of assets held by the firm. Inadequate asset utilization denotes the company is being less effective with each dollar of assets it shows. Put another way, asset utilization of Eargo Inc shows how discouraging it operates for each dollar spent on its assets.
| Current Assets | 136.84 Million | 87.78 |
| Assets Non Current | 16.77 Million | 10.76 |
| Goodwill | 2.29 Million | 1.47 |
Will Eargo fall impact its fundamentals?
The information ratio is down to -0.13 as of today. Eargo Inc is displaying above-average volatility over the selected time horizon. Investors should scrutinize Eargo Inc independently to ensure intended market timing strategies are aligned with expectations about Eargo volatility. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Eargo'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 Eargo'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.
Eargo Implied Volatility
Eargo's implied volatility exposes the market's sentiment of Eargo Inc stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Eargo'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 Eargo stock will not fluctuate a lot when Eargo's options are near their expiration.
Our Conclusion on Eargo
While some firms in the medical devices industry are either recovering or due for a correction, Eargo may not be performing as strong as the other in terms of long-term growth potentials. With a relatively neutral outlook on the latest economy, it is better to hold off any trading of Eargo as the current risk-reward utility is not appealing enough. 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 Eargo.
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Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, predictive investment analytics, and risk management.
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 Vlad Skutelnik do not own shares of EargoInc. Please refer to our
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