The company has a beta of 0.1851. Let's try to break down what Ocean's beta means in this case. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Ocean Power will likely underperform. The beta indicator helps investors understand whether Ocean Power moves in the same direction as the rest of the market, and how volatile (i.e., risky) it is compared to the market (i.e., selected benchmark). In other words, if Ocean deviates very little from the market, it does not add much risk to the portfolio, but it also doesn't increase the expected returns.
There are currently many different techniques concerning forecasting the market as a whole as well as
predicting future values of individual securities such as Ocean Power Technologies. Regardless of method or technology, to accurately forecast the stock market is more a matter of luck rather than a particular technique. Nevertheless, trying to predict the stock market accurately is still an essential part of the overall investment decision process. Using different forecasting techniques and comparing the results might improve your chances of accuracy even though unexpected events may often change the
market sentiment and impact your forecasting results.
Predictive Modules for Ocean Power
Sophisticated investors, who have witnessed
many market ups and downs, anticipate that the market will even out over time. This tendency of Ocean Power's price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Ocean Power. Your research has to be compared to or analyzed against Ocean Power's peers to derive any actionable benefits. When done correctly, Ocean Power's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy toward taking a position in Ocean Power Technologies.
Watch out for price decline
Please consider monitoring Ocean Power on a daily basis if you are holding a position in it. Ocean Power is trading at a penny-stock level, and the possibility of delisting is much higher compared to other stocks. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion.
Most exchanges require public instruments, such as Ocean Power stock to be traded above the $1 level to remain listed. If Ocean Power stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.
How important is Ocean Power's Liquidity
Ocean Power
financial leverage refers to using borrowed capital as a funding source to finance Ocean Power Technologies 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. Financial leverage can amplify the potential profits to Ocean Power'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 Ocean Power'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 Ocean Power's total debt and its cash.
Ocean Power Gross Profit
Ocean Power Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Ocean Power previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Ocean Power Gross Profit growth over the last 10 years. Please check Ocean Power's
gross profit and other
fundamental indicators for more details.
Detailed Perspective On Ocean Power
The newest indifference towards the small price fluctuations of Ocean Power Tech may encourage private investors to take a closer look at the company as it is trading at a share price of
2.96 on
45,377,100 in trading volume. The company directors and management did not add any value to Ocean Power investors in
June. However, most investors can still diversify their portfolios with Ocean Power Tech to hedge their inherited risk against high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 4.88. This high volatility is attributed to the latest market swings and not so good earnings reports for some of the Ocean Power partners.
Our perspective of the newest Ocean Power gain
The maximum drawdown is down to 21.45 as of today. Ocean Power Tech exhibits very low volatility with skewness of 0.54 and kurtosis of 0.41. However, we advise investors to further study Ocean Power Tech technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Ocean Power's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Ocean Power's 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 Ocean Power
When is the right time to buy or sell Ocean Power Tech? Buying stocks such as Ocean Power isn't very hard. However, what challenging for most investors is doing it at the right time. Proper market timing is something most people cannot do without
sophisticated tools, which help to isolate the right opportunities, deliver winning trades and diversify portfolios on a daily basis.
With a less-than optimistic outlook for your 90 days horizon, it may be a good time to exit some or all of your Ocean Power holdings as it seems the potential growth was already fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Ocean Power.
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Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce.
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 Rifka Kats do not own shares of Ocean Power Technologies. Please refer to our
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