Ideanomics (NASDAQ: IDEX), a player in the Farm & Heavy Construction Machinery industry, has been experiencing a downward trend in its stock price. This trend may be attributed to both weak technical and fundamental indicators. The company reported a significant loss in its net income from continuing operations, amounting to
$267.1M. Additionally, the company's operating income also recorded a loss of $91.2M. The company's total cash from operating activities also dipped into the negative territory, with a loss of $75.5M. These financial indicators may be contributing to the current slide in
Ideanomics' stock price. Despite recent unusual performance, the stock's technical and fundamental indicators remain robust. The current turbulence on Wall Street could also indicate long-term gains for the company's investors. However, Ideanomics currently has a bankruptcy probability exceeding 59%. Does this high risk dampen the optimism of the company's investors?
Typically, a company's
financial statements are the reports that show the
financial position of the company. There are three main documents that fall into the category of financial statements. These documents include Ideanomics income statement, its balance sheet, and the statement of cash flows. Potential Ideanomics investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although Ideanomics investors may use each financial statement separately, they are all related. The changes in Ideanomics's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Ideanomics's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our
technical analysis and
fundamental analysis pages.
The goal of Ideanomics
fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of Ideanomics performance into the future periods or doing a reasonable stock valuation. The intrinsic value of Ideanomics shares is the value that is considered the true value of the share. If
the intrinsic value of Ideanomics is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares Ideanomics. Please read more on our
fundamental analysis page.
Watch out for price decline
Please consider monitoring Ideanomics on a daily basis if you are holding a position in it. Ideanomics is trading at a penny-stock level, and the possibility of delisting is much higher compared to other delisted stocks. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion.
Most exchanges require public instruments, such as Ideanomics stock to be traded above the $1 level to remain listed. If Ideanomics stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.
How important is Ideanomics's Liquidity
Ideanomics
financial leverage refers to using borrowed capital as a funding source to finance Ideanomics ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Ideanomics 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 Ideanomics' 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 Ideanomics' 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 Ideanomics's total debt and its cash.
What is driving Ideanomics Investor Appetite?
The entity reported the previous year's revenue of 114.08
M. Net Loss for the year was (256.73
M) with loss before overhead, payroll, taxes, and interest of (815
K).
Please be aware that individual investors typically purchase shares for their personal accounts and usually in smaller quantities compared to institutional investors. While they might influence Ideanomics' decisions if they own a significant combined portion of its shares, such influence is relatively rare. Conversely, institutional investors - like mutual funds, pension funds, hedge funds, and other investment companies - often have a substantial sway over Ideanomics' decisions due to their larger holdings.
Asset Utilization
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Ideanomics has an asset utilization ratio of 24.1 percent. This suggests that the company is making $0.24 for each dollar of assets. An increasing asset utilization means that Ideanomics is more efficient with each dollar of assets it utilizes for everyday operations.
| Current Assets103.1 M | Assets Non Current138.9 M | Goodwill87.8 M |
| Current Assets | 103.1 Million | 31.26 |
| Assets Non Current | 138.93 Million | 42.12 |
| Goodwill | 87.83 Million | 26.63 |
As Warren Buffet once wisely noted, it's only when the tide goes out that you learn who's been swimming naked. This sentiment seems to aptly apply to Ideanomics (USA Stocks: IDEX), a company that has been experiencing a significant slide in its stock price. The company's weak technical and
fundamental indicators appear to be the main drivers of this downward trend. With a negative net income of
256.7M, the company is incurring substantial losses. Additionally, the company's total operating expenses stand at
114.4M, further straining its
financial health. The risk-adjusted performance of -0.1 and a quarterly revenue growth of -0.13 further underscore the company's financial struggles. Despite these challenges, the company's end period cash flow of 269.9M and a debt to equity ratio of 0.11% indicate some financial resilience. However, given these mixed signals, investors should approach Ideanomics with caution.
Will price continue to rise in December 2023?
As of today, the Value at Risk (VaR) for Ideanomics stock has decreased to -11.16, indicating a diminished potential for significant losses. This suggests that the company's risk management strategies are proving effective, and the stock's volatility is on a downward trend. Given this pattern, it is reasonable to anticipate that the price of Ideanomics stock could continue to ascend in December 2023. However, investors should maintain vigilance and closely monitor the company's performance and market conditions, as
stock prices can be swayed by a multitude of factors. Ideanomics has exhibited above-average volatility over the selected time horizon. Investors should thoroughly analyze Ideanomics independently to ensure that their intended
market timing strategies align with their expectations about Ideanomics' volatility. Understanding different
market volatility trends can often assist investors in timing the market. Proper utilization of volatility indicators allows traders to gauge Ideanomics' stock risk against market volatility during both bullish and bearish trends. The heightened level of volatility that accompanies bear markets can directly affect
Ideanomics' stock price, adding stress to investors as they witness their shares' value decline. This typically compels investors to rebalance their portfolios by purchasing different stocks as prices drop.
Our Bottom Line On Ideanomics
While other companies in the farm & heavy construction machinery industry are either recovering or due for a correction, Ideanomics may not be as strong as the others in terms of longer-term growth potentials. With a somewhat neutral outlook on your 90 days horizon, it may be better to hold off any trading activity and neither purchase new shares of Ideanomics nor short your existing holdings in the Stock. It seems the expected volatility has not yet been fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Ideanomics.
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Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, 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 Vlad Skutelnik do not own shares of Ideanomics. Please refer to our
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