Loop Industries Stock Story

LOOP
 Stock
  

USD 7.05  0.01  0.14%   

Given the investment horizon of 60 days Loop Industries is expected to under-perform the market. In addition to that, the company is 3.52 times more volatile than its market benchmark. It trades about -0.12 of its total potential returns per unit of risk. The DOW is currently generating roughly -0.11 per unit of volatility. As many old-fashioned traders are trying to avoid basic materials space, it makes sense to recap Loop Industries a little further and try to understand its current volatility patterns. We will focus on why it could be a different year for Loop Industries shareholders.
Published over a month ago
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Loop Industries (NASDAQ:LOOP) high volatility trend continues

Loop Industries currently holds roughly 55.04 M in cash with (40.78 M) of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 1.16.
The company secures a Beta (Market Risk) of 1.5254, which conveys a somewhat significant risk relative to the market. Let's try to break down what Loop Industries's beta means in this case. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Loop Industries will likely underperform. Even though it is essential to pay attention to Loop Industries 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. Loop Industries exposes twenty-six different technical indicators, which can help you to evaluate its performance. Loop Industries has an expected return of -0.62%. Please be advised to verify Loop Industries maximum drawdown, as well as the relationship between the expected short fall and day median price to decide if Loop Industries performance from the past will be repeated at some point in the near future.
Volatility is a rate at which the price of Loop Industries or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Loop Industries may increase or decrease. In other words, similar to Loop Industries's beta indicator, it measures the risk of Loop Industries and helps estimate the fluctuations that may happen in a short period of time. So if prices of Loop Industries fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.

How important is Loop Industries's Liquidity

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

How does Loop Industries utilize its cash?

To perform a cash flow analysis of Loop Industries, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Loop Industries is receiving and how much cash it distributes out in a given period. The Loop Industries cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Loop Industries Net Cash Flow from Operations is very stable at the moment as compared to the past year. Loop Industries reported last year Net Cash Flow from Operations of (42.98 Million)

Loop Industries Volatility Drivers

Loop Industries unsystematic risk is unique to Loop Industries and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Loop Industries you can also buy ALUMIFUEL PWR CORP. You can also mitigate this risk by investing in the specialty chemicals sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Loop Industries important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Loop Industries income statement and balance sheet. Here are more details about Loop Industries volatility.
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