Contango Story

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It looks as if Contango Oil may not have a good chance to recover from the latest dip as its shares fell again. The entity's current daily volatility is 6.82 percent, with a beta of 2.64 and an alpha of -0.67 over DOW. As many millenniums are trying to avoid the latest volatility, we are going to digest Contango Oil Gas a little further to understand its historical price patterns. What exactly are Contango Oil shareholders getting in September?
Published over a month ago
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Is Contango Oil (NYSEMKT:MCF) way too risky for millennials?
Contango Oil Gas has roughly 1.69 M in cash with 21.6 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 0.01. The company has 88.07 M in debt with debt to equity (D/E) ratio of 8.06, demonstrating that Contango Oil may be unable to create cash to meet all of its financial commitments. Contango Oil Gas has a current ratio of 0.79, suggesting that it has not enough short term capital to pay financial commitments when the payables are due.

How important is Contango Oil's Liquidity

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

How Contango utilizes its cash?

To perform a cash flow analysis of Contango Oil, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Contango Oil is receiving and how much cash it distributes out in a given period. The Contango Oil cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Contango Oil 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 21.71 Million

Breaking down Contango Oil Indicators

Contango Oil Gas secures Sharpe Ratio (or Efficiency) of -0.0317, which signifies that the company had -0.0317% of return per unit of risk over the last month. Macroaxis standpoint towards foreseeing 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. Contango Oil Gas exposes twenty-one different technical indicators, which can help you to evaluate volatility that cannot be diversified away. Please be advised to confirm Contango Oil Gas risk adjusted performance of (0.022455), and Mean Deviation of 5.15 to double-check the risk estimate we provide.
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Will Contango Oil continue to go ballistic?

Contango Oil latest potential upside ascents over 11.58. Contango Oil Gas is displaying above-average volatility over the selected time horizon. Investors should scrutinize Contango Oil Gas independently to ensure intended market timing strategies are aligned with expectations about Contango Oil volatility.

Our Bottom Line On Contango Oil Gas

Although many other companies in the oil & gas e&p industry are either recovering or due for a correction, Contango may not be as strong as the others in terms of longer-term growth potentials. On the whole, as of the 19th of August 2020, we believe that at this point, Contango Oil is overvalued with very high probability of distress within the next 2 years. Our final Buy-Hold-Sell recommendation on the firm is Cautious Hold.

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 Vlad Skutelnik do not own shares of Contango Oil Gas. Please refer to our Terms of Use for any information regarding our disclosure principles.

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