General Finance is slightly risky given 1 month investment horizon.
General Finance Corp holds Efficiency (Sharpe) Ratio of 0.19, which attests that the entity had 0.19% of return per unit of risk over the last month. Our standpoint towards determining the risk of a stock is to use both market data as well as company specific technical data. We were able to analyze and collect data for twenty-seven different
technical indicators, which can help you to evaluate if expected returns of 1.51% are justified by taking the suggested risk. Use General Finance Corp
market risk adjusted performance of 0.1362, and Risk Adjusted Performance of
(0.004532) to evaluate company specific risk that cannot be
diversified away.
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. Financial leverage can amplify the potential profits to General Finance'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 General Finance'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 General Finance's total debt and its cash.
What is driving General Finance Investor Appetite?
Although in the United States, the Securities and Exchange Commission has enforced strong rules to prevent insiders from engaging in insider trading, finding insiders among active shareholders of General Finance is not uncomon. Many companies such as General Finance have both institutions investors and insiders sharing the ownership. Retail investors typically buy and sell stocks in round lots of 100 shares or more. Other other hand institutional investors are known to buy and sell in block trades of 10,000 shares or more. Let's take a look at how the ownership of General is distributed among investors.
Ownership Allocation
General Finance secures a total of 30.23 Million outstanding shares. General Finance secures significant amount of outstanding shares owned by
insiders. An
insider is usually defined as a CEO, other corporate executive, director, or
institutional investor who own at least 10% of the company outstanding shares. Since such a large part of the company is owned by insiders, it is advisable to analyze if each of these insiders have been buying or selling the stock in recent months. Note that regardless of who owns the company, if the true value of the entity is less than the market is willing to pay for it, you may not be able to generate positive returns over time.
| Retail Investors19.88% | Insiders54.97% | Institutions25.15% |
| Retail Investors | 19.88 |
| Insiders | 54.97 |
| Institutions | 25.15 |
Asset Utilization
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. General Finance has an asset utilization ratio of 51.36 percent. This suggests that the company is making $0.51 for each dollar of assets. An increasing asset utilization means that General Finance Corp is more efficient with each dollar of assets it utilizes for everyday operations.
| Assets Non Current272.5 M | Goodwill138 M | |
| Current Assets | 79.51 Million | 16.2 |
| Assets Non Current | 272.47 Million | 55.5 |
| Goodwill | 137.99 Million | 28.11 |
| Tax Assets | 958,263 | 0.2 |
Over 3 percent rise for General Finance. What does it mean for institutional investors?
Latest total risk alpha is at -1.44. General Finance Corp is displaying above-average volatility over the selected time horizon. Investors should scrutinize General Finance Corp independently to ensure intended market timing strategies are aligned with expectations about General Finance volatility. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure General Finance's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact General Finance's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
Our Conclusion on General Finance
Whereas other companies within the rental & leasing services industry are still a little expensive, even after the recent corrections, General Finance may offer a potential longer-term growth to institutional investors. On the whole, as of the 17th of April 2021, our analysis shows that General Finance moves totally opposite to the market. The company is
overvalued and projects
below average chance of financial distress for the next 2 years. Our latest 30 days Buy-Hold-Sell recommendation on the company is
Strong Sell.
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Ellen Johnson is a Member of Macroaxis Editorial Board. Ellen covers public companies in North America, focusing primarily on valuation and volatility. Six years of experience in predictive investment analytics and risk management.
View Profile 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 Ellen Johnson do not own shares of General Finance. Please refer to our
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