FAT Brands Story

<div class='circular--portrait' style='background:#FF01C9;color: #FFF8DC;font-size:4em;'>FB</div>
FAT -- USA Stock  

USD 6.39  0.11  1.69%

It appears FAT Brands will continue to recover much faster as its share price surged up 28.08% today. This firm's current daily volatility is 5.8 percent, with a beta of -0.17 and an alpha of 0.99 over DOW. While some baby boomers are getting worried about current market swings, it is reasonable to review FAT Brands. We will evaluate if FAT Brands shares are reasonably priced going into January.
Published over a month ago
View all stories for FAT Brands | View All Stories
Should you purchase FAT Brands after the newest volatility drop?
FAT Brands has roughly 12.11 M in cash with (5.65 M) of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 1.01. On a scale of 0 to 100, FAT Brands holds a performance score of 10. The firm shows a Beta (market volatility) of -0.1687, which means not very significant fluctuations relative to the market. Let's try to break down what FAT Brands's beta means in this case. As returns on the market increase, returns on owning FAT Brands are expected to decrease at a much lower rate. During the bear market, FAT Brands is likely to outperform the market. Although it is vital to follow FAT Brands historical returns, it is good to be conservative about what you can do with the information regarding equity current trending patterns. The way of predicting future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. We have found twenty-eight technical indicators for FAT Brands, which you can use to evaluate the performance of the entity. Please utilizes FAT Brands value at risk, as well as the relationship between the skewness and day median price to make a quick decision on whether FAT Brands price patterns will revert.
Investing in FAT Brands, 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 FAT Brands 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 FAT Brands' stock 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 FAT Brands 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 FAT Brands. Your research has to be compared to or analyzed against FAT Brands' peers to derive any actionable benefits. When done correctly, FAT Brands' 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 FAT Brands.

How important is FAT Brands's Liquidity

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

How FAT Brands utilizes its cash?

To perform a cash flow analysis of FAT Brands, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash FAT Brands is receiving and how much cash it distributes out in a given period. The FAT Brands cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. FAT Brands Net Cash Flow from Operations is comparatively stable at the moment as compared to the past year. FAT Brands reported Net Cash Flow from Operations of 1.72 Million in 2020

FAT Brands Correlation with Peers

Investors in FAT Brands can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in FAT Brands. Diversification will allow for the same portfolio return with reduced risk. The correlation table of FAT Brands and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities FAT Brands 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 FAT Brands for more details

Breaking down FAT Brands Further

FAT Brands appears to be relatively risky, given 1 month investment horizon. FAT Brands secures Sharpe Ratio (or Efficiency) of 0.15, which denotes the company had 0.15% of return per unit of volatility over the last month. Our viewpoint regarding predicting the volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. By examining FAT Brands technical indicators you can today evaluate if the expected return of 0.89% is justified by implied risk. Please utilize FAT Brands Mean Deviation of 3.68, market risk adjusted performance of (5.72), and Downside Deviation of 3.9 to check if our risk estimates are consistent with your expectations.
Click cells to compare fundamentals   Check Volatility   Backtest Portfolio

FAT Brands implied volatility may change after the gain

Newest market risk adjusted performance is at -5.72. FAT Brands shows above-average downside volatility for the selected time horizon. We advise investors to inspect FAT Brands further and ensure that all market timing and asset allocation strategies are consistent with the estimation of FAT Brands future alpha.

Our Final Take On FAT Brands

Whereas many other companies within the restaurants industry are still a little expensive, even after the recent corrections, FAT Brands may offer a potential longer-term growth to private investors. To conclude, as of the 12th of December 2020, our overall 30 days advice on the firm is Cautious Hold. We believe FAT Brands is overvalued with below average chance of bankruptcy for the next two years.

About Contributor

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 Achuva Shats do not own shares of FAT Brands. 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