Mid Penn Story

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MPB -- USA Stock  

USD 23.52  0.64  2.65%

Considering the 60-days investment horizon, Mid Penn is expected to generate 1.13 times less return on investment than the market. In addition to that, the company is 2.9 times more volatile than its market benchmark. It trades about 0.03 of its total potential returns per unit of risk. The DOW is currently generating roughly 0.1 per unit of volatility. While some risk-loving traders are indifferent towards current market volatility, it is reasonable to go over the risk of investing in Mid Penn Bancorp. We will cover the possibilities of Mid Penn's current volatility to continue through November.
Published over a month ago
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Is Mid Penn (NASDAQ:MPB) positioned to overcome the current market swings?
Mid Penn Bancorp has roughly 143.99 M in cash with 6.64 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 17.1.
Volatility is a rate at which the price of Mid Penn 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 Mid Penn may increase or decrease. In other words, similar to Mid Penn's beta indicator, it measures the risk of Mid Penn and helps estimate the fluctuations that may happen in a short period of time. So if prices of Mid Penn 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 Mid Penn's Liquidity

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

How Mid Penn utilizes its cash?

To perform a cash flow analysis of Mid Penn, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Mid Penn is receiving and how much cash it distributes out in a given period. The Mid Penn cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities. Mid Penn Net Cash Flow from Operations is projected to increase significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at 7.83 Million

Mid Penn Volatility Drivers

Mid Penn unsystematic risk is unique to Mid Penn Bancorp 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 Mid Penn you can also buy Eagle Bancorp Montana. You can also mitigate this risk by investing in the banks?regional 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 Mid Penn 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 Mid Penn income statement and balance sheet. Here are more details about Mid Penn volatility.
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Click cells to compare fundamentals   

Mid Penn exotic insider transaction detected

Legal trades by Mid Penn 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:
Mid Penn insider trading alert for general transaction of mid penn bancorp inc. common stock by Robert Abel, the corporate stakeholder, on 9th of October 2020. This event was filed by Mid Penn Bancorp Inc with SEC on 2020-10-09. 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.

Going after Mid Penn Financials

The current indifference towards the small price fluctuations of Mid Penn Bancorp may encourage investors to take a closer look at the firm as it is trading at a share price of 20.05 on slow start in trading volume. The company directors and management did not add any value to Mid Penn Bancorp investors in September. However, most investors can still diversify their portfolios with Mid Penn Bancorp to hedge their inherited risk against high-volatility market scenarios. The stock standard deviation of daily returns for 30 days investing horizon is currently 2.85. The current volatility is consistent with the ongoing market swings in September 2020 as well as with Mid Penn Bancorp unsystematic, company-specific events.
 2017 2018 2019 2020 (projected)
Share Based Compensation145 K267 K346 K279.14 K
Net Cash Flow from Operations11.89 M10.98 M7.83 M10.03 M

Mid Penn showing appearance of lower volatility

Current variance is at 52.07. Mid Penn Bancorp is displaying above-average volatility over the selected time horizon. Investors should scrutinize Mid Penn Bancorp independently to ensure intended market timing strategies are aligned with expectations about Mid Penn volatility.

Our Final Take On Mid Penn

Whereas some other companies within the banks?regional industry are still a little expensive, even after the recent corrections, Mid Penn may offer a potential longer-term growth to investors. To summarize, as of the 24th of October 2020, our current 30 days advice on the company is Hold. We believe Mid Penn is overvalued with close to average chance of distress for the next two years.

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 Achuva Shats do not own shares of Mid Penn Bancorp. Please refer to our Terms of Use for any information regarding our disclosure principles.

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