Fulcrum Story

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FULC -- USA Stock  

USD 7.64  0.21  2.68%

Fulcrum Therapeutics is currently generating 0.2146% in daily expected returns and assumes 5.6248% risk (volatility on return distribution) over the 60 days horizon. As many adventurous traders are excited about healthcare space, it is only fair to go over the risk of shorting Fulcrum Therapeutics based on its current volatility spike. We are going to analyze if the current expected returns justify Fulcrum Therapeutics' volatility.
Published over a month ago
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Breaking down Fulcrum volatility
Fulcrum Therapeutics currently holds 51 K in liabilities. This firm has a current ratio of 5.83, suggesting that it is liquid enough and is able to pay its financial obligations when due. On a scale of 0 to 100, Fulcrum Therapeutics holds a performance score of 2. The firm shows a Beta (market volatility) of 0.6022, which means possible diversification benefits within a given portfolio. Let's try to break down what Fulcrum's beta means in this case. As returns on the market increase, Fulcrum Therapeutics returns are expected to increase less than the market. However, during the bear market, the loss on holding Fulcrum Therapeutics will be expected to be smaller as well. Although it is extremely important to respect Fulcrum Therapeutics historical returns, it is better to be realistic regarding the information on equity current trending patterns. The philosophy towards 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. By reviewing Fulcrum Therapeutics technical indicators, you can presently evaluate if the expected return of 0.21% will be sustainable into the future. Please utilizes Fulcrum Therapeutics jensen alpha, potential upside, accumulation distribution, as well as the relationship between the treynor ratio and expected short fall to make a quick decision on whether Fulcrum Therapeutics price patterns will revert.
Volatility is a rate at which the price of Fulcrum Therapeutics or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Fulcrum Therapeutics may increase or decrease. In other words, similar to Fulcrum's beta indicator, it measures the risk of Fulcrum Therapeutics and helps estimate the fluctuations that may happen in a short period of time. So if prices of Fulcrum Therapeutics fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility. Please read more on our technical analysis page.

How important is Fulcrum Therapeutics's Liquidity

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

How Fulcrum utilizes its cash?

To perform a cash flow analysis of Fulcrum Therapeutics, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Fulcrum Therapeutics is receiving and how much cash it distributes out in a given period. The Fulcrum Therapeutics cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Fulcrum Therapeutics Net Cash Flow from Operations is projected to decrease significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at (39.48 Million)

Fulcrum Therapeutics Volatility Drivers

Fulcrum Therapeutics unsystematic risk is unique to Fulcrum Therapeutics and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Fulcrum Therapeutics you can also buy DYADIC INTERNATIONAL INC. You can also mitigate this risk by investing in the biotechnology sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Fulcrum Therapeutics important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Fulcrum Therapeutics income statement and balance sheet. Here are more details about Fulcrum volatility.
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Exercise or conversion by Wallace Owen B of 6350 shares of Fulcrum Therapeutics subject to Rule 16b-3

Legal trades by Fulcrum Therapeutics insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Fulcrum insider trading alert for exercise of stock option (right to buy) by Wallace Owen B, Chief Scientific Officer, on 14th of September 2020. This event was filed by Fulcrum Therapeutics Inc with SEC on 2020-09-14. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

A Deeper Perspective

The current bullish price patterns experienced by current Fulcrum Therapeutics shareholders could raise concerns from investors as the firm closed today at a share price of 17.05 on 61,247 in volume. The company executives have been very successful in rebalancing the firm assets at opportune times to take advantage of market volatility in July. The stock standard deviation of daily returns for 30 days investing horizon is currently 5.62. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the Fulcrum Therapeutics partners.

Fulcrum Therapeutics has 81 percent chance to finish above $16.78 in September

The kurtosis is down to 6.02 as of today. Fulcrum Therapeutics is displaying above-average volatility over the selected time horizon. Investors should scrutinize Fulcrum Therapeutics independently to ensure intended market timing strategies are aligned with expectations about Fulcrum Therapeutics volatility.

Whereas some other entities in the biotechnology industry are either recovering or due for a correction, Fulcrum Therapeutics may not be performing as strong as the other in terms of long-term growth potentials. To conclude, as of the 11th of August 2020, we see that Fulcrum Therapeutics follows the market closely. The company is undervalued with average chance of financial distress within the next 24 months. Our primary 30 days advice on the company is Cautious Hold.

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 Gabriel Shpitalnik do not own shares of Fulcrum Therapeutics. Please refer to our Terms of Use for any information regarding our disclosure principles.

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