Northern Story

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NTIC -- USA Stock  

USD 15.14  0.10  0.66%

As many rational traders are trying to avoid basic materials space, it makes sense to go over Northern Technologies Intl a little further and understand how it stands against Givaudan and other similar entities. We are going to analyze some of the competitive aspects of both Northern and Givaudan.
Published over a week ago
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Will Givaudan investors switch to Northern (NASDAQ:NTIC)?
By analyzing existing forward indicators between Northern Technologies and Givaudan, 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 Givaudan with a short position in Northern Technologies. 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. Northern Technologies has an asset utilization ratio of 89.66 percent. This suggests that the company is making $0.9 for each dollar of assets. An increasing asset utilization means that Northern Technologies Intl 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 companies, such as Northern or Sherwin is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

UNDERSTANDING Northern Technologies dividends

A dividend is the distribution of a portion of Northern Technologies earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Northern Technologies dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Northern one year expected dividend income is about $0.1 per share.
Investing in stocks that pay dividends, such as stock of Northern Technologies Intl, is one of many strategies that are good for long-term investments. Ex-dividend dates are significant because investors in Northern Technologies must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Northern Technologies. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.

How important is Northern Technologies's Liquidity

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

Correlation Between Northern and Sherwin-Williams

In general, 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 Northern Technologies together with similar or unrelated positions with a negative correlation. For example, you can also add Sherwin Williams to your portfolio. If Sherwin Williams is not perfectly correlated to Northern Technologies 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 Northern Technologies for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Please check pair correlation details between NTIC and SHW for more information.

Note

Are you currently holding both Northern Technologies and Sherwin Williams in your portfolio?
Please note if you are using this as a pair-trade strategy between Northern Technologies and Sherwin Williams, 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.

Acquisition by Matthew Wolsfeld of 55244 shares of Northern Technologies subject to Rule 16b-3

Legal trades by Northern Technologies 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:
Northern insider trading alert for grant of stock option (right to buy) by Matthew Wolsfeld, CFO and Corporate Secretary, on 3rd of September 2020. This event was filed by Northern Technologies Int with SEC on 2020-09-03. 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.

Breaking down the case for Northern Technologies

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 take a closer look at Northern Technologies revenue. Based on the latest financial disclosure, Northern Technologies Intl reported 45.79 M of revenue. This is 99.42% lower than that of the Basic Materials sector and 98.97% lower than that of the Specialty Chemicals industry. The revenue for all United States stocks is 99.51% higher than that of the firm. As for Givaudan we see revenue of 6.73 B, which is 51.23% higher than that of the Specialty Chemicals

Sector
4.5 B
GVDBF
6.7 B
NTIC45.79 Million0.41
Sector4.45 Billion39.64
GVDBF6.73 Billion59.95

Northern Technologies is epected to finish above $14.43 in May

The expected short fall is down to -3.65 as of today. Northern Technologies Intl shows above-average downside volatility for the selected time horizon. We advise investors to inspect Northern Technologies Intl further and ensure that all market timing and asset allocation strategies are consistent with the estimation of Northern Technologies future alpha. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Northern Technologies' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Northern Technologies' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Our Conclusion on Northern Technologies

Whereas many of the other players under the specialty chemicals industry are still a bit expensive, Northern Technologies may offer a potential longer-term growth to investors. The bottom line, as of the 7th of April 2021, our analysis shows that Northern Technologies responds to the market. The company is undervalued and projects below average odds of distress for the next 2 years. Our current 30 days buy-or-sell advice on the company is Strong Buy.

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 Northern Technologies Intl. Please refer to our Terms of Use for any information regarding our disclosure principles.

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