Heico Corp has roughly 124.82
M in cash with 414.86
M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 0.92.
Macroaxis provides investment recommendation on Heico Corp to complement and cross-verify current
analyst consensus on Heico Corp. Our trade recommendations engine determines the entity's potential to grow exclusively from the perspective of an investor's current risk tolerance and investing horizon.
Investing in Heico, 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 Heico 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 Heico'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.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Heico. Your research has to be compared to or analyzed against Heico's peers to derive any actionable benefits. When done correctly, Heico'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 Heico.
How important is Heico's Liquidity
Heico
financial leverage refers to using borrowed capital as a funding source to finance Heico ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Heico 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 Heico'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 Heico'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 Heico's total debt and its cash.
Heico Correlation with Peers
Investors in Heico can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Heico. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Heico and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Heico 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 Heico for more details
What is driving Heico Investor Appetite?
Heico Corp holds Efficiency (Sharpe) Ratio of -0.0478, which attests that the entity had -0.0478% of return per unit of risk over the last 3 months. Macroaxis standpoint towards determining the risk of any stock is to look at both systematic and unsystematic factors of the business, including all available market data and
technical indicators. Heico Corp exposes twenty-eight different
technical indicators, which can help you to evaluate volatility that cannot be
diversified away. Please be advised to check out Heico Corp
market risk adjusted performance of
(0.13), and Risk Adjusted Performance of
(0.08) to validate the risk estimate we provide.
Heico Corp has 93 percent chance to stay above $135 in 2 months
Current market risk adjusted performance is at -0.13. Heico Corp exhibits very low volatility with skewness of -0.21 and kurtosis of -0.46. However, we advise investors to further study Heico Corp technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Heico Corp'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 Heico Corp'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.
Heico Corp Implied Volatility
Heico Corp's implied volatility exposes the market's sentiment of Heico Corp stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Heico Corp's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Heico Corp stock will not fluctuate a lot when Heico Corp's options are near their expiration.
Our Bottom Line On Heico Corp
While some companies in the aerospace & defense industry are either recovering or due for a correction, Heico may not be as strong as the others in terms of longer-term growth potentials. To conclude, as of the 22nd of May 2022, we believe that at this point, Heico Corp is
undervalued with
very small probability of distress within the next 2 years. Our ongoing Buy-Hold-Sell recommendation on the company is
Strong Hold.
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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 Heico. Please refer to our
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