Klx Energy Stock Story

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KLXE
 Stock
  

USD 6.00  0.03  0.50%   

By Raphi Shpitalnik
Macroaxis Story
It looks as if Klx Energy may not have a good chance to recover from the latest dip as its shares fell again. The company current daily volatility is 6.1 percent, with a beta of 1.12 and an alpha of -0.46 over DOW. While many traders are getting carried away by overanalyzing market volatility, it is reasonable to digest Klx Energy Services based on how it reacts to the latest economic swings. We will analyze why Klx Energy investors may still consider a stake in the business.
Published over a month ago
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Should you take up Klx Energy after the latest volatility dip?

Klx Energy Services currently holds roughly 28 M in cash with (60.65 M) of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 2.67.
The company secures a Beta (Market Risk) of 1.1174, which conveys a somewhat significant risk relative to the market. Let's try to break down what Klx Energy's beta means in this case. Klx Energy returns are very sensitive to returns on the market. As the market goes up or down, Klx Energy is expected to follow. Even though it is essential to pay attention to Klx Energy Services price patterns, it is always good to be careful when utilizing equity historical price patterns. Our philosophy towards estimating any stock's future performance is to check both, its past performance charts as well as the business as a whole, including all available technical indicators. Klx Energy exposes twenty-eight different technical indicators, which can help you to evaluate its performance. Klx Energy Services has an expected return of -0.3%. Please be advised to verify Klx Energy Services downside variance, as well as the relationship between the accumulation distribution and market facilitation index to decide if Klx Energy Services performance from the past will be repeated at some point in the near future.
Investing in Klx Energy, 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 Klx Energy 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.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Klx Energy'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. Please use the tools below to analyze the current value of Klx Energy in the context of predictive analytics.
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Please note, it is not enough to conduct a financial or market analysis of a single entity such as Klx Energy. Your research has to be compared to or analyzed against Klx Energy's peers to derive any actionable benefits. When done correctly, Klx Energy's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy towards taking a position in Klx Energy Services.

How important is Klx Energy's Liquidity

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

How does Klx Energy utilize its cash?

To perform a cash flow analysis of Klx Energy, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Klx Energy is receiving and how much cash it distributes out in a given period. The Klx Energy cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Klx Energy Net Cash Flow from Operations is projected to decrease significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at (58.41 Million)

Klx Energy Correlation with Peers

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

Details

Klx Energy Services has Sharpe Ratio of -0.05, which conveys that the firm had -0.05% of return per unit of risk over the last 3 months. Macroaxis standpoint towards estimating the risk of any stock is to look at both systematic and unsystematic factors of the business, including all available market data and technical indicators. Klx Energy exposes twenty-eight different technical indicators, which can help you to evaluate volatility that cannot be diversified away. Please be advised to verify Klx Energy Services risk adjusted performance of (0.12), and Mean Deviation of 4.37 to check out the risk estimate we provide.

Is Klx Energy dip permanent?

Klx Energy latest skewness ascents over 0.25. Klx Energy Services is displaying above-average volatility over the selected time horizon. Investors should scrutinize Klx Energy Services independently to ensure intended market timing strategies are aligned with expectations about Klx Energy volatility. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Klx Energy's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Klx Energy's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Klx Energy Implied Volatility

Klx Energy's implied volatility exposes the market's sentiment of Klx Energy Services stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Klx Energy's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Klx Energy stock will not fluctuate a lot when Klx Energy's options are near their expiration.

Our Final Take On Klx Energy

Although few other entities in the oil & gas equipment & services industry are either recovering or due for a correction, Klx Energy may not be as strong as the others in terms of longer-term growth potentials. With an impartial outlook on the current market volatility, it may be better to hold off any inventment activity and neither take in nor trade any shares of Klx Energy at this time. The Klx Energy Services risk-reward trade off is not appealing enough to do any trading. 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 Klx Energy.

Editorial Staff

Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time base at the beginning of the pandemic and eventually acquired a real test for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI. 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 Raphi Shpitalnik do not own shares of Klx Energy Services. Please refer to our Terms of Use for any information regarding our disclosure principles.

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