Should we continue shadow First American (USA Stocks:FAF) executives?

FAF Stock

USD 53.71 0.44 0.83%

Macroaxis Story

It seems as First American may not recover as fast as we have hopped for as its price went down 0.21% today. First American current daily volatility is 1.75 percent, with a beta of 1.57 and an alpha of 0.24 over Dow Jones Industrial. As many of us are getting excited about current market fluctuations it is important to concentrate on First American based on its technical indicators. We will evaluate why recent First American price moves suggest a bounce in March.

Published over a month ago

View all stories for First American | View All Stories

Macroaxis uses a strict editorial review process to publish our stories and blog posts. Our publishers support our company and may receive a small commission when the partner links or references are utilized. Commissions do not affect the opinions or evaluations of our editorial team. The information our editors and media partners deliver is confidential and licensed for your sole use as a Macroaxis user. We reserve all rights to the content of this article, and therefore copying or distributing this story in whole or in part is strictly prohibited.

Reviewed by Raphi Shpitalnik

First American has roughly 1.23 B in cash with 1.22 B of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 23.39.

The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. First American has an asset utilization ratio of 56.01 percent. This implies that the company is making $0.56 for each dollar of assets. An increasing asset utilization means that First American is more efficient with each dollar of assets it utilizes for everyday operations.

Should we continue shadow First American (USA Stocks:FAF) executives?

Investing in First American, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding First American along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.

Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of First American'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 use the tools below to analyze the current value of First American in the context of predictive analytics.

Please note, it is not enough to conduct a financial or market analysis of a single entity such as First American. Your research has to be compared to or analyzed against First American's peers to derive any actionable benefits. When done correctly, First American's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy towards taking a position in First American.

How important is First American's Liquidity

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

How does First utilize its cash?

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

First American Net Cash Flow from Operations is most likely to increase significantly in the upcoming years. The last year's value of Net Cash Flow from Operations was reported at 780 Million

First American Correlation with Peers

Investors in First can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in First American. Diversification will allow for the same portfolio return with reduced risk. The correlation table of First American and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities First is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage.

Please check volatility of First for more details

Breaking down First American Indicators

First American appears to be very steady, given 3 months investment horizon. First American secures Sharpe Ratio (or Efficiency) of 0.12, which denotes the company had 0.12% of return per unit of risk over the last 3 months. Our standpoint towards predicting the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-one technical indicators for First American, which you can use to evaluate the future volatility of the firm. Please utilize First American's Downside Deviation of 1.68, coefficient of variation of 559.37, and Mean Deviation of 1.62 to check if our risk estimates are consistent with your expectations.

	ARW	NUVL	COUR	EDTK	SESN
ARW		-0.05	0.87	0.56	0.49	ARW
NUVL	-0.05		0.15	-0.35	0.01	NUVL
COUR	0.87	0.15		0.3	0.39	COUR
EDTK	0.56	-0.35	0.3		0.55	EDTK
SESN	0.49	0.01	0.39	0.55		SESN
	ARW	NUVL	COUR	EDTK	SESN

Click cells to compare fundamentals

Check Volatility

Backtest Portfolio

First American is likely to close below USD63 next week

First American current risk adjusted performance boosts over 0.19. First American has relatively low volatility with skewness of 1.03 and kurtosis of 3.22. However, we advise all investors to independently investigate First American to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure First American'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 First American'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.

Our Takeaway on First American Investment

While many other companies under the insurance—specialty industry are still a bit expensive, First American may offer a potential longer-term growth to stockholders. With an optimistic outlook on your 90 days horizon, it may be a good time to buy new shares of First or increase your existing holdings in the Stock as it seems the potential growth has not yet been 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 First American.

Editorial Staff

Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce. 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 Rifka Kats do not own shares of First American. 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

Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions

Feedback Blog

Made with optimal in San Francisco

2023 Macroaxis LLC

Should we continue shadow First American (USA Stocks:FAF) executives?

Reviewed by Raphi Shpitalnik

How important is First American's Liquidity

How does First utilize its cash?

First American Correlation with Peers

Breaking down First American Indicators

First American is likely to close below USD63 next week

Our Takeaway on First American Investment

Editorial Staff

Would you like to provide feedback on the content of this article?

COMMON DESTINATIONS

MAIN CATEGORIES

COMPANY