Does Luk Fook (OTC:LKFLF) have sound technical and fundamental indicators based on the latest surge?

In spite of rather unsteady technical and fundamental indicators, Luk Fook exhibited solid returns over the last few months and may actually be approaching a breakup point. The company moves indifferently to market moves. We can now discuss LKFLF as a potential investment option for your portfolios.
Published over a year ago
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Reviewed by Gabriel Shpitalnik

We provide investment recommendation to complement the last-minute expert consensus on Luk Fook Holdings. Our dynamic recommendation engine harnesses a multidimensional algorithm to analyze the entity's potential to grow using all technical and fundamental data available at the time. Luk Fook dividends can provide a clue to the current value of the stock. The firm one year expected dividend income is about $0.72 per share.

How important is Luk Fook's Liquidity

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

An Additional Perspective On Luk Fook Holdings

Although in the United States, the Securities and Exchange Commission has enforced strong rules to prevent insiders from engaging in insider trading, finding insiders among active shareholders of Luk Fook is not uncomon. Institutional investors typically avoid acquiring a high percentage of Luk Fook stocks because performing such an act may violate securities laws. They are usually not investing their own money, but rather making investments on behalf of their clients. Let's take a look at how the ownership of LKFLF is distributed among investors.

Ownership Allocation

Luk Fook Holdings maintains a total of five hundred eighty-seven million one hundred ten thousand outstanding shares. Luk Fook Holdings holds significant amount of outstanding shares owned by insiders. An insider is usually defined as a CEO, other corporate executive, director, or institutional investor who own at least 10% of the company outstanding shares. Since such a large part of the company is owned by insiders, it is advisable to analyze if each of these insiders have been buying or selling the stock in recent months. Please note that no matter how much assets the company has, if the real value of the firm is less than the current market value, you may not be able to make money on it.
Retail Investors
22.84%
Insiders
44.07%
Institutions
33.09%
Retail Investors22.84
Insiders44.07
Institutions33.09

Volatility analysis of Luk Fook indicates possible reversal in December

Latest potential upside is at 9.24. As of the 26th of November, Luk Fook secures the Downside Deviation of 23.37, risk adjusted performance of 0.1293, and Mean Deviation of 6.96. In connection with fundamental indicators, the technical analysis model lets you check existing technical drivers of Luk Fook Holdings, as well as the relationship between them. 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 analyze and collect data for nineteen technical drivers for Luk Fook, which can be compared to its peers in the industry. Please verify Luk Fook Holdings jensen alpha, as well as the relationship between the potential upside and skewness to decide if Luk Fook Holdings is priced some-what accurately, providing market reflects its recent price of 2.52 per share. Please also check out Luk Fook total risk alpha, which is currently at 0.7219 to check the company can sustain itself at a future point.

The Current Takeaway on Luk Fook Investment

Although many other companies under the luxury goods industry are still a bit expensive, Luk Fook may offer a potential longer-term growth to shareholders. To conclude, as of the 26th of November 2020, we believe that Luk Fook is currently overvalued with low probability of financial unrest in the next two years. Our ongoing 30 days Buy-Hold-Sell recommendation on the firm is Strong Sell.

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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 Ellen Johnson do not own shares of Luk Fook Holdings. Please refer to our Terms of Use for any information regarding our disclosure principles.

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