FTS International (NYSE:FTSI) high volatility trend continues

FTS International is currently does not generate positive expected returns and assumes 10.4918% risk (volatility on return distribution) over the 60 days horizon. As many adventurous traders are excited about energy space, it is only fair to concentrate on the risk of shorting FTS International based on its current volatility spike. We will examine if the expected returns on FTS International will justify its current volatility. The current FTS International risk factors may impact the value of the stock as we estimate FTS International as currently undervalued. The real value is approaching 5.62 per share.
Published over a year ago
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Reviewed by Vlad Skutelnik

FTS International currently holds 457.7 M in liabilities. The entity has a current ratio of 2.07, suggesting that it is liquid enough and is able to pay its financial obligations when due. The firm shows a Beta (market volatility) of -0.844, which means possible diversification benefits within a given portfolio. Let's try to break down what FTS International's beta means in this case. As returns on the market increase, returns on owning FTS International are expected to decrease at a much lower rate. During the bear market, FTS International is likely to outperform the market. Even though it is essential to pay attention to FTS International historical returns, it is always good to be careful when utilizing equity current trending patterns. Our approach towards predicting any stock's future performance is to check both, its past performance charts as well as the business as a whole, including all available technical indicators. FTS International exposes twenty-eight different technical indicators, which can help you to evaluate its performance. FTS International has an expected return of -0.23%. Please be advised to confirm FTS International value at risk, as well as the relationship between the skewness and day median price to decide if FTS International stock performance from the past will be repeated at future time.

How important is FTS International's Liquidity

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

Another Deeper Perspective

The current FTS International price drop could raise concerns from stockholders as the firm it trading at a share price of 4.42 on slow start in volume. The company management teams were unable to exploit market volatilities in September. However, diversifying your overall positions with FTS International can protect your principal portfolio during market swings. The stock standard deviation of daily returns for 30 days investing horizon is currently 10.49. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the FTS International partners.
 2017 2018 2019 2020 (projected)
Current Assets506.6 M409.7 M352.5 M351.49 M
Total Assets831 M743.7 M639.3 M651.27 M

Our perspective of the current FTS International rise

Coefficient Of Variation just dropped to -1413.02, may hint to upcoming price decrease. FTS International is displaying above-average volatility over the selected time horizon. Investors should scrutinize FTS International independently to ensure intended market timing strategies are aligned with expectations about FTS International volatility.

While other companies in the oil & gas equipment & services industry are either recovering or due for a correction, FTS International may not be performing as strong as the other in terms of long-term growth potentials. To sum up, as of the 8th of October 2020, we see that FTS International moves totally opposite to the market. The company is undervalued with very high odds of distress within the next 24 months. However, our overall 30 days buy-hold-sell recommendation on the company is Strong Sell.

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Editorial Staff

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 FTS International. Please refer to our Terms of Use for any information regarding our disclosure principles.

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