IDEXX Story

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IDXX -- USA Stock  

USD 457.15  2.92  0.63%

It appears IDEXX Laboratories may not recover as fast as we have hopped for as its price went down 0.31% today. The company's current daily volatility is 1.93 percent, with a beta of 0.03 and an alpha of 0.32 over DOW. While many traders are getting carried away by overanalyzing market volatility, it is reasonable to break down IDEXX Laboratories based on how it reacts to the current economic swings. We will evaluate why recent IDEXX Laboratories price moves suggest a bounce in November.
Published over a month ago
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Are IDEXX Laboratories (NASDAQ:IDXX) investors starting to panic?
IDEXX Laboratories currently holds roughly 105.29 M in cash with 523.69 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 1.24. Macroaxis provides investment recommendation on IDEXX Laboratories to complement and cross-verify current analyst consensus on IDEXX Laboratories. 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 IDEXX Laboratories, 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 IDEXX Laboratories 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.

How important is IDEXX Laboratories's Liquidity

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

How IDEXX utilizes its cash?

To perform a cash flow analysis of IDEXX Laboratories, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash IDEXX Laboratories is receiving and how much cash it distributes out in a given period. The IDEXX Laboratories cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. IDEXX Laboratories Net Cash Flow from Operations is fairly stable at the moment as compared to the past year. IDEXX Laboratories reported Net Cash Flow from Operations of 459.16 Million in 2019

IDEXX Laboratories Correlation with Peers

Investors in IDEXX can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in IDEXX Laboratories. Diversification will allow for the same portfolio return with reduced risk. The correlation table of IDEXX Laboratories and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities IDEXX 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 IDEXX for more details

Exercise or conversion by Giovani Twigge of 12801 shares of IDEXX Laboratories subject to Rule 16b-3

Legal trades by IDEXX Laboratories insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
IDEXX insider trading alert for exercise of non-qualified stock option (right-to-buy) by Giovani Twigge, CORPORATE VICE PRESIDENT, on 2nd of December 2020. This event was filed by Idexx Laboratories Inc with SEC on 2020-12-02. Statement of changes in beneficial ownership - SEC Form 4. Giovani Twigge currently serves as chief human resource officer, corporate vice president of IDEXX Laboratories [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Details

We consider IDEXX Laboratories very steady. IDEXX Laboratories holds Efficiency (Sharpe) Ratio of 0.0995, which attests that the entity had 0.0995% of return per unit of return volatility over the last month. Our approach into determining the volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for IDEXX Laboratories, which you can use to evaluate future volatility of the firm. Please check out IDEXX Laboratories Semi Deviation of 1.91, risk adjusted performance of 0.1815, and Market Risk Adjusted Performance of 11.5 to validate if the risk estimate we provide is consistent with the expected return of 0.19%.
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IDEXX Laboratories has 98 percent likelihood to slide below $433 in November

The treynor ratio is down to 11.49 as of today. IDEXX Laboratories currently demonstrates below-verage downside deviation. It has Information Ratio of 0.15 and Jensen Alpha of 0.32. However, we do advice investors to further question IDEXX Laboratories expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

The Bottom Line

While many other companies in the diagnostics & research industry are either recovering or due for a correction, IDEXX may not be as strong as the others in terms of longer-term growth potentials. In closing, as of the 29th of October 2020, our up-to-date 30 days buy-hold-sell advice on the company is Strong Buy. However, we believe IDEXX Laboratories is currently overvalued with very small probability of distress 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 Vlad Skutelnik do not own shares of IDEXX Laboratories. Please refer to our Terms of Use for any information regarding our disclosure principles.

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