Should you exit your Exxon (NYSE:XOM) and Novagold Resources (AMEX:NG) positions after an ascent?


USD 5.77  0.34  5.56%   

It looks like Exxon will continue to recover much faster as its share price surged up 4.55% today to Novagold Resources's 5.1173%. As many rational traders are trying to avoid basic materials space, it makes sense to digest Novagold Resources a little further and understand how it stands against Exxon and other similar entities. We are going to discuss some of the competitive aspects of both Novagold and Exxon.
Published over a month ago
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By analyzing existing technical and fundamental indicators between Novagold Resources and Exxon, 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 Exxon with a short position in Novagold Resources. 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. Novagold Resources has an asset utilization ratio of 0.15 percent. This indicates that the company is making $0.001467 for each dollar of assets. An increasing asset utilization means that Novagold Resources is more efficient with each dollar of assets it utilizes for everyday operations.

How important is NovaGold Resources's Liquidity

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

How does NovaGold utilize its cash?

To perform a cash flow analysis of NovaGold Resources, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash NovaGold Resources is receiving and how much cash it distributes out in a given period. The NovaGold Resources cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
NovaGold Resources 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 (11.52 Million)

What is driving NovaGold Resources Investor Appetite?

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

Lets now check Novagold Resources revenue. Based on the latest financial disclosure, Novagold Resources reported 599 K of revenue. This is 99.99% lower than that of the Basic Materials sector and 99.96% lower than that of the Gold industry. The revenue for all United States stocks is 99.99% higher than that of Novagold Resources. As for Exxon we see revenue of 354.96 B, which is much higher than that of the Gold

355 B
Sector1.52 Billion0.43
XOM354.96 Billion99.57

Another 3 percent surge for Novagold Resources

The value at risk is down to -5.52 as of today.
As of the 3rd of October, Novagold Resources secures the mean deviation of 2.3, and Risk Adjusted Performance of (0.05). In connection with fundamental indicators, the technical analysis model lets you check existing technical drivers of Novagold Resources, 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 Novagold Resources, which can be compared to its peers in the industry. Please verify Novagold Resources jensen alpha, potential upside, as well as the relationship between the Potential Upside and skewness to decide if Novagold Resources is priced some-what accurately, providing market reflects its recent price of 4.93 per share. Given that Novagold Resources has jensen alpha of (0.019769), we recommend you to check Novagold Resources's last-minute market performance to make sure the company can sustain itself at a future point.

Our Conclusion on Novagold Resources

Although some firms within the gold industry are still a little expensive, even after the recent corrections, Novagold Resources may offer a potential longer-term growth to shareholders. On the whole, as of the 3rd of October 2022, our analysis shows that Novagold Resources responds to the market. The firm is undervalued and projects below average chance of financial distress for the next 2 years. However, our latest 90 days recommendation on the firm is Sell.

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

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