By analyzing existing fundamental indicators between Harsco and Barnes, 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 Barnes with a short position in Harsco. 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. Harsco has an asset utilization ratio of 76.17 percent. This suggests that the company is making $0.76 for each dollar of assets. An increasing asset utilization means that Harsco is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two entities, such as Enviri or Casella is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.
How important is Enviri's Liquidity
Enviri
financial leverage refers to using borrowed capital as a funding source to finance Enviri ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Enviri 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 Enviri'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 Enviri'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 Enviri's total debt and its cash.
Correlation Between Enviri and Casella Waste Systems
In general, Delisted Stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Enviri together with similar or unrelated positions with a negative correlation. For example, you can also add Casella Waste to your portfolio. If Casella Waste is not perfectly correlated to Enviri it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Enviri, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Are you currently holding both Enviri and Casella Waste in your portfolio? Please note if you are using this as a pair-trade strategy between Enviri and Casella Waste, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses. Please check
pair correlation details between HSC and CWST for more information.
Another Deeper Perspective
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
Lets now take a look at Harsco revenue. Based on the latest financial disclosure, Harsco reported 1.57
B of revenue. This is 55.13% lower than that of the Industrials sector and significantly higher than that of the
Specialty Industrial Machinery industry. The revenue for all United States stocks is 83.36% higher than that of Harsco. As for Barnes we see revenue of 1.31
B, which is much higher than that of the Specialty Industrial Machinery
| Harsco | 1.57 Billion |
| Sector | 0.0 |
| Barnes | 1.31 Billion |
Analysis of Harsco
Jensen alpha is down to 0.93. It may suggest a possible volatility slip. As of the 5th of August, Harsco retains the Market Risk Adjusted Performance of 4.08,
downside deviation of 5.77, and Risk Adjusted Performance of 0.2672. Harsco
technical analysis makes it possible for you to employ
historical prices and volume momentum with the intention to determine a pattern that calculates the direction of the firm's future prices. Simply put, you can use this information to find out if the firm will indeed mirror its model of historical price patterns, or the prices will eventually revert. We were able to break down nineteen
technical drivers for Harsco, which can be compared to its competitors. Please check out
Harsco variance,
maximum drawdown, as well as the
relationship between the Maximum Drawdown and
semi variance to decide if Harsco is priced fairly, providing market reflects its last-minute price of 16.6 per share. Given that Harsco has
jensen alpha of 0.9261, we strongly advise you to confirm Harsco's regular market performance to make sure the company can sustain itself at a future point.
The Bottom Line
Whereas many other companies in the specialty industrial machinery industry are either recovering or due for a correction, Harsco may not be as strong as the others in terms of longer-term growth potentials. To sum up, as of the 5th of August 2020, our up-to-date 30 days advice on the company is
Cautious Hold. We believe Harsco is currently
overvalued with
below average chance of distress for the next two years.
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Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce.
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 Rifka Kats do not own shares of Enviri. Please refer to our
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