Harmonic Story

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As many millenniums are excited about technology space, we are going to shadow both, Harmonic and EXFO Inc as a potential short-horizon opportunity. We are going to break down some of the competitive aspects of both Harmonic and EXFO Inc.
Published over a month ago
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Should you exit your EXFO Inc (NASDAQ:EXFO) and Harmonic (NASDAQ:HLIT) positions after an advance?
By analyzing existing basic indicators between Harmonic and EXFO Inc, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in EXFO Inc with a short position in Harmonic. Check out our pair correlation module for more information.

Let's begin by analyzing the assets. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Harmonic has an asset utilization ratio of 76.42 percent. This implies that the company is making $0.76 for each dollar of assets. An increasing asset utilization means that Harmonic is more efficient with each dollar of assets it utilizes for everyday operations.

How important is Harmonic's Liquidity

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

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions. It is good to see analyst projects for Harmonic, but it might be worth checking our own buy vs. sell analysis

A Deeper look at Harmonic

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Now, let's check Harmonic revenue. Based on the latest financial disclosure, Harmonic reported 401.18 M of revenue. This is 90.16% lower than that of the Technology sector and 91.81% lower than that of the Communication Equipment industry. The revenue for all United States stocks is 95.75% higher than that of the entity. As for EXFO Inc we see revenue of 265.19 M, which is 94.59% lower than that of the Communication Equipment

Sector
4.1 B
HLIT401.18 Million8.46
Sector4.08 Billion85.95
EXFO265.19 Million5.59

Will Harmonic instantly start a reversion?

Newest Information Ratio is up to -0.07. Price may reset again. Harmonic exhibits very low volatility with skewness of 0.19 and kurtosis of 0.45. However, we advise investors to further study Harmonic technical indicators to make sure all market info is available and is reliable.

Our Final Take On Harmonic

Whereas some companies in the communication equipment industry are either recovering or due for a correction, Harmonic may not be as strong as the others in terms of longer-term growth potentials. Taking everything into account, as of the 2nd of August 2020, our actual 30 days recommendation on the firm is Strong Sell. However, we believe Harmonic is undervalued with high odds of financial turmoil for the next two years.

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 Achuva Shats do not own shares of Harmonic. Please refer to our Terms of Use for any information regarding our disclosure principles.

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