ESSA Pharma volatility makes investors worry

EPIX Stock

USD 2.91 0.01 0.34%

Macroaxis Story

ESSA Pharma is currently generating 1.8924% in daily expected returns and assumes 23.4877% risk (volatility on return distribution) over the 90 days horizon. While some risk-loving traders are indifferent towards current market volatility, it is reasonable to break down the risk of investing in ESSA Pharma. We will go over odds for ESSA Pharma to generate above-average margins in two-three weeks. The current ESSA Pharma risk factors may impact the value of the stock as we estimate ESSA Pharma as currently undervalued. The real value is approaching 11.74 per share.

Published over a month ago

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The company conducts business under Biotechnology sector and is part of Health Care industry.

ESSA Pharma holds a performance score of 6 on a scale of zero to a hundred. The firm shows a Beta (market volatility) of 0.9875, which means possible diversification benefits within a given portfolio. Let's try to break down what ESSA Pharma's beta means in this case. ESSA Pharma returns are very sensitive to returns on the market. As the market goes up or down, ESSA Pharma is expected to follow. Although it is essential to pay attention to ESSA Pharma historical returns, it is also good to be reasonable about what you can do with equity current trending patterns. Our approach towards predicting future performance of any stock is to look not only at its past charts but also at the business as a whole, including all fundamental and technical indicators. To evaluate if ESSA Pharma expected return of 1.89 will be sustainable into the future, we have found twenty-eight different technical indicators, which can help you to check if the expected returns are sustainable. Use ESSA Pharma potential upside, as well as the relationship between the accumulation distribution and price action indicator to analyze future returns on ESSA Pharma.

ESSA Pharma volatility makes investors worry

Volatility is a rate at which the price of ESSA Pharma 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 ESSA Pharma may increase or decrease. In other words, similar to ESSA Pharma's beta indicator, it measures the risk of ESSA Pharma and helps estimate the fluctuations that may happen in a short period of time. So if prices of ESSA Pharma 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 ESSA Pharma's Liquidity

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

How does ESSA Pharma utilize its cash?

To perform a cash flow analysis of ESSA Pharma, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash ESSA Pharma is receiving and how much cash it distributes out in a given period. The ESSA Pharma cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Sale by Franklin Berger of 43617 shares of ESSA Pharma

Legal trades by ESSA Pharma insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:

ESSA Pharma insider trading alert for sale of common shares by Franklin Berger, the corporate stakeholder, on 5th of January 2023. This event was filed by Essa Pharma Inc with SEC on 2023-01-05. Statement of changes in beneficial ownership - SEC Form 4 [view details]

Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down the case for ESSA Pharma

The current price rise of ESSA Pharma could raise concerns from investors as the firm is trading at a share price of 3.14 on 19,548 in volume. The company management teams may have good odds in positioning the firm resources to exploit market volatility in January. The stock standard deviation of daily returns for 90 days investing horizon is currently 23.49. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the ESSA Pharma partners.

ESSA Pharma implied volatility may change after the slide

ESSA Pharma current maximum drawdown rises over 198.6. ESSA Pharma is displaying above-average volatility over the selected time horizon. Investors should scrutinize ESSA Pharma independently to ensure intended market timing strategies are aligned with expectations about ESSA Pharma volatility. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure ESSA Pharma's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact ESSA Pharma'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.

While other entities under the biotechnology industry are still a bit expensive, ESSA Pharma may offer a potential longer-term growth to investors. To conclude, as of the 12th of December 2022, we see that ESSA Pharma hyperactively responds to market trends. The company is undervalued with low odds of distress within the next 24 months. Our primary 90 days buy vs. sell advice on the company is Strong Hold.

Editorial Staff

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 ESSA Pharma. Please refer to our Terms of Use for any information regarding our disclosure principles.

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