Karuna Story

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KRTX -- USA Stock  

USD 78.97  1.87  2.43%

It appears Karuna Therapeutics will continue to recover much faster as its share price surged up 5.08% today. The company's current daily volatility is 3.8 percent, with a beta of -0.1 and an alpha of 0.25 over DOW. As many millenniums are excited about favorable retirement market, it is only fair to break down Karuna Therapeutics. We will analyze why Karuna Therapeutics investors may still consider a stake in the business.
Published over a month ago
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Will the current Karuna Therapeutics volatility rise frighten investors?
Karuna Therapeutics currently holds roughly 367.58 M in cash with (39.37 M) of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 13.81. Karuna Therapeutics currently holds 2.62 M in liabilities with Debt to Equity (D/E) ratio of 0.01, which may suggest Karuna Therapeutics is not taking enough advantage from borrowing. This firm has a current ratio of 90.28, suggesting that it is liquid enough and is able to pay its financial obligations when due.
Investing in Karuna Therapeutics, 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 Karuna Therapeutics 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 Karuna Therapeutics's Liquidity

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

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions. It is good to see analyst projects for Karuna Therapeutics, but it might be worth checking our own buy vs. sell analysis

Karuna Therapeutics Correlation with Peers

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

Exercise or conversion by Pande Atul of 5000 shares of Karuna Therapeutics subject to Rule 16b-3

Legal trades by Karuna Therapeutics 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:
Karuna insider trading alert for exercise of option (right to buy) by Pande Atul, the corporate stakeholder, on 18th of September 2020. This event was filed by Karuna Therapeutics Inc with SEC on 2020-09-18. Statement of changes in beneficial ownership - SEC Form 4 [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.

Breaking it down a bit more

We consider Karuna Therapeutics very steady. Karuna Therapeutics has Sharpe Ratio of 0.0288, which conveys that the firm had 0.0288% of return per unit of risk over the last month. Our standpoint towards estimating 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 Karuna Therapeutics, which you can use to evaluate future volatility of the firm. Please verify Karuna Therapeutics Risk Adjusted Performance of 0.0964, mean deviation of 3.04, and Downside Deviation of 3.66 to check out if the risk estimate we provide is consistent with the expected return of 0.11%.
Click cells to compare fundamentals   Check Volatility   Backtest Portfolio

Our perspective of the current Karuna Therapeutics rise

Karuna Therapeutics information ratio is up to 0.01. As of the 15th of August 2020, Karuna Therapeutics secures the Mean Deviation of 3.04, risk adjusted performance of 0.0964, and Downside Deviation of 3.66. Karuna Therapeutics technical analysis lets you operate historical price patterns with an objective to determine a pattern that forecasts the direction of the firm's future prices. Strictly speaking, you can use this information to find out if the firm will indeed mirror its model of past prices, or the prices will eventually revert. We were able to interpolate nineteen technical drivers for Karuna Therapeutics, which can be compared to its peers in the industry. Please verify Karuna Therapeutics variance and potential upside to decide if Karuna Therapeutics is priced some-what accurately, providing market reflects its recent price of 86.3 per share. Given that Karuna Therapeutics has jensen alpha of 0.25, we recommend you to check Karuna Therapeutics's last-minute market performance to make sure the company can sustain itself at a future point.

Our Bottom Line On Karuna Therapeutics

While some companies within the biotechnology industry are still a little expensive, even after the recent corrections, Karuna Therapeutics may offer a potential longer-term growth to investors. The bottom line, as of the 15th of August 2020, we believe that at this point, Karuna Therapeutics is undervalued with below average probability of financial unrest within the next 2 years. However, our primary Buy-Hold-Sell recommendation on the company is Strong Sell.

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 Raphi Shpitalnik do not own shares of Karuna Therapeutics. Please refer to our Terms of Use for any information regarding our disclosure principles.

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