General Story

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GFN -- USA Stock  

USD 6.23  0.06  0.95%

General Finance is scheduled to announce its earnings today. The next earnings report is expected on the 5th of November 2020. General Finance Net Current Assets as percentage of Total Assets are quite stable at the moment as compared to the past year. The company's current value of Net Current Assets as percentage of Total Assets is estimated at 6.00. Current Ratio is expected to rise to 1.79 this year, although the value of Net Income Per Employee will most likely fall to (7.5 K). While many traders are getting carried away by overanalyzing industrials space, it is reasonable to outline General Finance as an investment alternative. We will analyze why General Finance investors may still consider a stake in the business.
Published over a week ago
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Should I short my General (NASDAQ:GFN) holdings?
The company has 445.29 M in debt with debt to equity (D/E) ratio of 2.48, meaning that General Finance heavily relies on borrowing funds for operations. The company retains a Market Volatility (i.e. Beta) of 0.1529, which attests to not very significant fluctuations relative to the market. Let's try to break down what General's beta means in this case. As returns on the market increase, General Finance returns are expected to increase less than the market. However, during the bear market, the loss on holding General Finance will be expected to be smaller as well. Even though it is essential to pay attention to General Finance current price history, it is always good to be careful when utilizing equity current price movements. Our philosophy towards determining 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. General Finance exposes twenty-eight different technical indicators, which can help you to evaluate its performance. General Finance has an expected return of -0.0064%. Please be advised to check out General Finance sortino ratio, skewness, price action indicator, as well as the relationship between the potential upside and rate of daily change to decide if General Finance stock performance from the past will be repeated at some point in the near future.
General Finance financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of General Finance, including all of General Finance's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of General Finance assets, the company is considered highly leveraged. Understanding the composition and structure of overall General Finance debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

Understanding General Total Debt

General Finance liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. General Finance has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on General Finance balance sheet include debt obligations and money owed to different General Finance vendors, workers, and loan providers. Below is the chart of General main long-term debt accounts currently reported on its balance sheet.
You can use General Finance financial leverage analysis tool to get a better grip on understanding its financial position

How important is General Finance's Liquidity

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

Exercise or conversion by Ronald Valenta of 76000 shares of General Finance subject to Rule 16b-3

Legal trades by General Finance 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:
General insider trading alert for exercise of stock option (right to buy) by Ronald Valenta, the corporate stakeholder, on 1st of September 2020. This event was filed by General Finance Corp with SEC on 2020-09-01. 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 small slide in market price for the last few months may raise some interest from institutional investors. The stock closed today at a share price of 6.18 on slow start in trading volume. The company executives did not add much value to General Finance investors in August. However, diversifying your holdings with General Finance or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 30 days investing horizon is currently 4.03. This high volatility is attributed to the latest market swings and not so good earnings reports for some of the General Finance partners.

Asset Breakdown

272.5 M
Assets Non Current
148.4 M
Goodwill
86.4 M
Current Assets
Total Assets768.11 Million
Current Assets86.36 Million
Assets Non Current272.47 Million
Goodwill148.43 Million
Tax Assets958,263

General may start a relapse in October

Latest Risk Adjusted Performance is up to -0.02. Price may slide again. General Finance exhibits very low volatility with skewness of 0.08 and kurtosis of 0.64. However, we advise investors to further study General Finance technical indicators to make sure all market info is available and is reliable.

Our Takeaway on General Finance Investment

When is the right time to buy or sell General Finance? Buying stocks such as General Finance isn't very hard. However, what challenging for most investors is doing it at the right time. Proper market timing is something most people cannot do without sophisticated tools, which help to isolate the right opportunities, deliver winning trades and diversify portfolios on a daily bases. All things considered, as of the 9th of September 2020, our research shows that General Finance is a rather slightly risky investment opportunity with a close to average chance of distress in the next two years. From a slightly different view, the entity currently appears to be undervalued. Our actual 30 days 'Buy-Sell' recommendation 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 Vlad Skutelnik do not own shares of General Finance. Please refer to our Terms of Use for any information regarding our disclosure principles.

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