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How risky is First Hawaiian after the current volatility rise?
 | By Raphi Shpitalnik | Macroaxis Story |
It appears First Hawaiian may not recover as fast as we have hopped for as its price went down 1.74% today. This firm current daily volatility is 4.18 percent, with a beta of 2.25 and an alpha of 0.61 over DOW. As many millenniums are trying to avoid the current volatility, we are going to go over First Hawaiian a little further to understand its historical price patterns. We will look into some reasons why it is still possible for First Hawaiian to maintain above-average margins while minimizing volatility.
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Reviewed by Vlad Skutelnik
First Hawaiian has roughly 976.21 M in cash with 226.37 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 7.46. Our investment recommendation module complements current analysts and expert consensus on First Hawaiian. It analyzes the firm potential to grow using all fundamental, technical, and market related data available at the time.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as First Hawaiian. Your research has to be compared to or analyzed against First Hawaiian's peers to derive any actionable benefits. When done correctly, First Hawaiian'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 First Hawaiian.
Investing in First Hawaiian, 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 Hawaiian 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 First Hawaiian'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 First Hawaiian's Liquidity
First Hawaiian financial leverage refers to using borrowed capital as a funding source to finance First Hawaiian ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. First Hawaiian 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 First Hawaiian'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 First Hawaiian'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 First Hawaiian's total debt and its cash.
First Hawaiian Gross Profit
First Hawaiian Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing First Hawaiian 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 First Hawaiian Gross Profit growth over the last 10 years. Please check First Hawaiian's gross profit and other fundamental indicators for more details.
First Hawaiian 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 Hawaiian. Diversification will allow for the same portfolio return with reduced risk. The correlation table of First Hawaiian 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
What is the case for First Hawaiian Investors
First Hawaiian appears to be not too volatile, given 1 month investment horizon. First Hawaiian secures Sharpe Ratio (or Efficiency) of 0.16, which denotes the company had 0.16% of return per unit of risk over the last month. 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. By reviewing First Hawaiian technical indicators you can presently evaluate if the expected return of 0.67% is justified by implied risk. Please utilize First Hawaiian Mean Deviation of 2.52, downside deviation of 2.74, and Coefficient Of Variation of 463.47 to check if our risk estimates are consistent with your expectations.
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