Ocean Story

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OPTT -- USA Stock  

USD 2.88  0.05  1.71%

Given the investment horizon of 60 days, Ocean Power is expected to generate 11.48 times more return on investment than the market. However, the company is 11.48 times more volatile than its market benchmark. It trades about 0.2 of its potential returns per unit of risk. The DOW is currently generating roughly 0.1 per unit of risk. While some risk-loving traders are indifferent towards current market volatility, it is reasonable to review the risk of investing in Ocean Power. What exactly are Ocean Power shareholders getting in November?
Published over three months ago
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Ocean Power (NASDAQ:OPTT) high volatility trend continues
The company conducts business under Industrials sector and is part of Electrical Equipment & Parts industry. Ocean Power holds a performance score of 13 on a scale of zero to a hundred. The company holds a Beta of -0.5173, which implies possible diversification benefits within a given portfolio. Let's try to break down what Ocean's beta means in this case. As returns on the market increase, returns on owning Ocean Power are expected to decrease at a much lower rate. During the bear market, Ocean Power is likely to outperform the market. Although it is essential to pay attention to Ocean Power Technolo current trending patterns, it is also good to be reasonable about what you can do with equity existing price patterns. Our philosophy towards forecasting future potential of any stock is to look not only at its past charts but also at the business as a whole, including all available fundamental and technical indicators. To evaluate if Ocean Power Technolo expected return of 2.29 will be sustainable into the future, we have found twenty-eight different technical indicators, which can help you to check if the expected returns are sustainable. Use Ocean Power sortino ratio, as well as the relationship between the semi variance and rate of daily change to analyze future returns on Ocean Power.
Volatility is a rate at which the price of Ocean Power 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 Ocean Power may increase or decrease. In other words, similar to Ocean's beta indicator, it measures the risk of Ocean Power and helps estimate the fluctuations that may happen in a short period of time. So if prices of Ocean Power 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 Ocean Power's Liquidity

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

How Ocean utilizes its cash?

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

Breaking it down a bit more

The newest price gain of Ocean Power Technolo may encourage private investors to take a closer look at the company as it is trading at a share price of 2.18 on slow start in trading volume. The company executives may have good odds in positioning the company resources to exploit market volatility in November. The stock standard deviation of daily returns for 30 days investing horizon is currently 11.75. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the Ocean Power partners.

Our take on today Ocean Power gain

The skewness is down to 2.34 as of today. Ocean Power is displaying above-average volatility over the selected time horizon. Investors should scrutinize Ocean Power independently to ensure intended market timing strategies are aligned with expectations about Ocean Power volatility.

The Current Takeaway on Ocean Power Investment

Whereas many of the other players under the electrical equipment & parts industry are still a bit expensive, Ocean Power may offer a potential longer-term growth to private investors. Taking everything into account, as of the 6th of October 2020, we believe that Ocean Power is currently overvalued with high odds of financial turmoil in the next two years. Our primary 30 days buy-sell recommendation on the firm is Strong Sell.

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 Ellen Johnson do not own shares of Ocean Power. Please refer to our Terms of Use for any information regarding our disclosure principles.

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