Will Insmed (USA Stocks:INSM) continue to decline in July?

Despite a slight dip in Insmed Inc.'s stock price to $55.05, the company's technical indicators suggest a potential buying opportunity. The stock's Sortino Ratio of 0.65 indicates a favorable risk-adjusted return, while the potential upside of 5.25% suggests room for growth. However, investors should be aware of the company's significant operating loss of $709.6M.

Important Takeaways

Insmed Inc. is highly rated by 17 analysts, with an average rating of 'Strong Buy'. This consensus is not typically based on technical analysis, which uses price momentum, patterns, and trends from historical prices to identify signals based on market sentiment and investors' perception of Insmed's future value. Approximately 99.0% of Insmed's shares are held by institutional investors. The company reported a loss per share of $5.23 and has not issued any dividends in recent years. On March 3, 2011, the firm executed a 1:10 stock split.
Published over two weeks ago
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Reviewed by Michael Smolkin

Every cloud has a silver lining, and the recent slight dip in Insmed Inc. stock might just be that silver lining for savvy investors. Despite a market uptick, the biotechnology firm experienced a minor setback, with its valuation market value standing at $55.05 as of May 31, 2024. However, this could present a potential buying opportunity. The company's 50-day moving average is $27.57, while the 200-day moving average is $26.69, indicating a positive trend. Furthermore, the analyst overall consensus for the stock is a 'Strong Buy', with the highest estimated target price pegged at $47.26. Despite a net income loss of $749.6M, the firm managed to generate an interest income of $1.9M. The stock's beta of 0.93 suggests it is less volatile than the market, making it a potentially safer bet. However, with a short percent of 6.79% and 9.9M shares short, investors should tread carefully. The company's price to book ratio stands at 25.45, and its price to sales ratio is 13.26, both of which need to be considered. Despite the slight dip, the stock's naive expected forecast value is $69.22, indicating potential for growth. Biotechnology is an exciting field, and Insmed Inc. deserves a closer look. This may be an opportune time for short-term investors to consider Insmed. Despite the market's recent movements, Insmed's price behavior has been contrasting. The company's steady fundamental indicators could suggest potential long-term losses for investors. Currently, the stock is experiencing above-average trading activity.
Using predictive technical analysis, we can analyze different prices and returns patterns and diagnose historical swings to determine the real value of Insmed Inc. In general, sophisticated investors focus on analyzing Insmed stock price patterns and their correlations with different microeconomic environment and drivers. They apply predictive analytics to build Insmed's daily price indicators and compare them against related drivers such as momentum indicators and various other types of predictive indicators. Using this methodology combined with a more conventional technical analysis and fundamental analysis, we attempt to find the most accurate representation of Insmed's intrinsic value. In addition to deriving basic predictive indicators for Insmed, many experienced traders also check how macroeconomic factors affect Insmed price patterns. Please read more on our technical analysis page or use our predictive modules below to complement your research.
Sophisticated investors, who have witnessed many market ups and downs, anticipate that the market will even out over time. This tendency of Insmed'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.

How important is Insmed's Liquidity

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

Insmed Gross Profit

Insmed Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Insmed previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Insmed Gross Profit growth over the last 10 years. Please check Insmed's gross profit and other fundamental indicators for more details.

Closer look at Insmed Variance

Insmed Inc has current Variance of 220.76. Variance is another measure of security risk that shows the amount of dispersion of equity returns around their mean value. Variance is calculated as the average squared deviations from the mean. Evaluating a set of investment alternatives one can use variance to help determine the volatility when purchasing a specific security. Similar to Standard Deviation, the variance is a measure of how far a set of numbers is spread out around its mean.
Variance is also a measure of stock volatility and can help determine the risk an investor might take on when purchasing a specific security. A relatively big variance indicates that the daily prices or returns are far from the mean and a small variance indicates that they are located around the mean.

Variance

 = 

SUM(RET DEV)2

N

 = 
220.76
SUM = Summation notation
RET DEV = Actual returns deviation over selected period
N = Number of points for the period
Let's now compare Insmed Variance to its closest peers:
INSM
NKTX
CGEM
KZR
KRON
INSM220.76
NKTX50.81
CGEM32.19
KZR10.68
KRON26.14
"Buy when there's blood in the streets," goes the old investment adage. Insmed Inc., a player in the Biotechnology industry, recently experienced a slight dip in its stock price, despite a general market uptick. This dip, coupled with a Wall Street target price of $62.87, significantly higher than the current price, suggests a potential buying opportunity. However, investors should be cautious as the company's high total debt of $1.2B and a net income loss of $749.6M indicate financial instability. Furthermore, the high probability of bankruptcy at 63.39% adds to the risk factor, but with a current ratio of 5.93X, the company has a strong ability to meet its short-term obligations..

Another 3 percent decline for Insmed

Insmed Inc. recently displayed a Risk Adjusted Performance of 0.09, suggesting potential for increased volatility. Despite this, the stock's price is expected to decline by around 3 percent, based on current market trends and the company's recent performance. Investors are advised to monitor the stock's performance closely before investing. As of June 1st, Insmed's Market Risk Adjusted Performance was -0.77, with a downside deviation of 2.59, and Risk Adjusted Performance of 0.0861. Insmed's technical analysis allows for the use of historical prices and volume momentum to predict future prices. The company's nineteen technical drivers can be compared to its competitors.
Investors should also consider Insmed's variance, value at risk, and the relationship between the Value At Risk and skewness to determine if the stock is fairly priced. With a Jensen Alpha of 1.62, it's crucial to confirm Insmed's regular market performance to ensure future sustainability.In conclusion, despite the recent 3 percent decline in Insmed Inc's stock, the investment outlook remains promising. Analysts have a strong buy consensus on the stock, with 12 strong buys and 5 buys. The valuation real value stands at 41.28, slightly below the analyst target price estimated value of 42.58. However, the potential upside is significant, with the highest estimated target price reaching 47.26. Even considering the possible downside price of 54.02, the naive expected forecast value of 69.22 suggests a robust potential for growth. Investors should keep a close eye on Insmed as we approach the fiscal year end in December..

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Editorial Staff

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 Gabriel Shpitalnik do not own shares of Insmed Inc. Please refer to our Terms of Use for any information regarding our disclosure principles.

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