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Is FTI Consulting (NYSE:FCN) a good short-term trade as volatility surges?
 | By Rifka Kats | Macroaxis Story |
Lets try to outline the odds of FTI Consulting to fully recover from the latest slide as its shares went up 9.65%. FTI Consulting's current daily volatility is 2.34 percent, with a beta of 0.29 and an alpha of -0.33 over DOW. While many traders are getting carried away by overanalyzing business services, it is reasonable to outline FTI Consulting. We will analyze why it could be a much better year for FTI Consulting shareholders.
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Reviewed by Gabriel Shpitalnik
FTI Consulting has roughly 223.06 M in cash with 196.41 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 6.2. Macroaxis provides advice on FTI Consulting to complement and cross-verify current analyst consensus on FTI Consulting. Our investment recommendation engine determines the company's potential to grow exclusively from the perspective of an investor's current risk tolerance and investing horizon.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as FTI Consulting. Your research has to be compared to or analyzed against FTI Consulting's peers to derive any actionable benefits. When done correctly, FTI Consulting's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy toward taking a position in FTI Consulting.
Investing in FTI Consulting, 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 FTI Consulting 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, anticipate that the market will even out over time. This tendency of FTI Consulting'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.
How important is FTI Consulting's Liquidity
FTI Consulting financial leverage refers to using borrowed capital as a funding source to finance FTI Consulting ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. FTI Consulting 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 FTI Consulting'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 FTI Consulting'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 FTI Consulting's total debt and its cash.
FTI Consulting Gross Profit
FTI Consulting Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing FTI Consulting previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show FTI Consulting Gross Profit growth over the last 10 years. Please check FTI Consulting's gross profit and other fundamental indicators for more details.
FTI Consulting Correlation with Peers
Investors in FTI can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in FTI Consulting. Diversification will allow for the same portfolio return with reduced risk. The correlation table of FTI Consulting and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities FTI 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 FTI for more details
Is FTI Consulting valued appropriately by the market?
FTI Consulting secures Sharpe Ratio (or Efficiency) of -0.0697, which denotes the company had -0.0697% of return per unit of return volatility over the last month. Macroaxis viewpoint regarding 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. FTI Consulting exposes twenty-eight different technical indicators, which can help you to evaluate volatility that cannot be diversified away. Please be advised to confirm FTI Consulting mean deviation of 1.92 to check the risk estimate we provide.
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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 FTI Consulting. Please refer to our Terms of Use for any information regarding our disclosure principles.