By analyzing existing technical and fundamental indicators between Noble Midstream and Diamond, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Diamond with a short position in Noble Midstream. Check out our
pair correlation module for more information.
Let's begin by analyzing the assets. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Noble Midstream has an asset utilization ratio of 110.9 percent. This suggests that the company is making $1.11 for each dollar of assets. An increasing asset utilization means that Noble Midstream Partners is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two entities, such as Noble or Azul is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.
How important is Noble Midstream's Liquidity
Noble Midstream
financial leverage refers to using borrowed capital as a funding source to finance Noble Midstream Partners ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Noble Midstream 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 Noble Midstream'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 Noble Midstream'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 Noble Midstream's total debt and its cash.
Correlation Between Noble and Azul SA
In general, Delisted Stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Noble Midstream together with similar or unrelated positions with a negative correlation. For example, you can also add Azul SA to your portfolio. If Azul SA is not perfectly correlated to Noble Midstream it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Noble Midstream, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Are you currently holding both Noble Midstream and Azul SA in your portfolio? Please note if you are using this as a pair-trade strategy between Noble Midstream and Azul SA, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses. Please check
pair correlation details between NBLX and AZUL for more information.
An Additional Perspective On Noble Midstream Partners
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.
Revenue Breakdown
Let me now go over Noble Midstream revenue. Based on the latest financial disclosure, Noble Midstream Partners reported 767.14
M of revenue. This is 98.44% lower than that of the Energy sector and 93.47% lower than that of the
Oil & Gas Midstream industry. The revenue for all United States stocks is 91.87% higher than that of Noble Midstream. As for Diamond S we see revenue of 686.85
M, which is 94.15% lower than that of the Oil & Gas Midstream
| NBLX | 767.14 Million | 7.05 |
| Sector | 9.43 Billion | 86.65 |
| DSSI | 686.85 Million | 6.31 |
Will Noble slide impact its fundamentals?
Current market risk adjusted performance is at 3.0. Noble Midstream Partners is displaying above-average volatility over the selected time horizon. Investors should scrutinize Noble Midstream Partners independently to ensure intended market timing strategies are aligned with expectations about Noble Midstream volatility.
The Bottom Line
While many other companies in the oil & gas midstream industry are either recovering or due for a correction, Noble may not be as strong as the others in terms of longer-term growth potentials. The bottom line, as of the 2nd of August 2020, our primary 30 days buy-hold-sell recommendation on the company is
Sell. However, we believe Noble Midstream is currently
undervalued with
below average probability of distress for the next two years.
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Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time basis at the beginning of the pandemic and eventually acquired a real taste for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI.
View Profile 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 Noble Midstream Partners. Please refer to our
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