Margin Breakdown
| Operating Margin | (55.85) | |
| EBITDA Margin | (53.83) | |
| Gross Margin | 44.42 | |
| Profit Margin | (63.84) |
Our projection for Quotient (NASDAQ:QTNT) in September
 | By Raphi Shpitalnik | Macroaxis Story |
Quotient PPandE Turnover is comparatively stable at the moment as compared to the past year. Quotient reported PPandE Turnover of 0.74 in 2019. Receivables Turnover is likely to grow to 9.16 in 2020, whereas Earnings before Tax are likely to drop (42 M) in 2020. The essential rationale behind this perspective is to break down our current position on Quotient for private investors considering to short it. We will break down why Quotient private investors may still consider a stake in the business.
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Reviewed by Rifka Kats
Quotient has a beta of -0.4268. Let's try to break down what Quotient'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, Quotient will likely underperform. The beta indicator helps investors understand whether Quotient 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 Quotient deviates very little from the market, it does not add much risk to the portfolio, but it also doesn't increase the expected returns.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Quotient. Your research has to be compared to or analyzed against Quotient's peers to derive any actionable benefits. When done correctly, Quotient'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 Quotient.
There are currently many different techniques concerning forecasting the market as a whole as well as predicting future values of individual securities such as Quotient. 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 Quotient
Sophisticated investors, who have witnessed many market ups and downs, anticipate that the market will even out over time. This tendency of Quotient'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.
Watch out for price decline
Please consider monitoring Quotient on a daily basis if you are holding a position in it. Quotient is trading at a penny-stock level, and the possibility of delisting is much higher compared to other delisted 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 Quotient stock to be traded above the $1 level to remain listed. If Quotient 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 Quotient's Liquidity
Quotient financial leverage refers to using borrowed capital as a funding source to finance Quotient ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Quotient 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 Quotient'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 Quotient'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 Quotient's total debt and its cash.
Breaking it down a bit more
The modest gains experienced by current holders of Quotient created some momentum for private investors as it was traded today as low as 7.79 and as high as 8.39 per share. The company management teams have been quite successful in maneuvering the stock at opportune times to take advantage of all market conditions in July. The stock standard deviation of daily returns for 30 days investing horizon is currently 5.14. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the Quotient partners.
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