Select Story

SEM -- USA Stock

USD 31.65 4.93 18.45%

Macroaxis Story

Select Medical Interest Coverage is relatively stable at the moment as compared to the past year. The company's current value of Interest Coverage is estimated at 2.96. Calculated Tax Rate is expected to hike to 33.67 this year, although the value of Average Assets will most likely fall to nearly 3.6 B. While many traders today are more concerned about the preservation of capital over market returns, Select Medical Holdings could be one exception. We will analyze why it could be a much better year for Select Medical shareholders. In this post, I will also go over some essential variables affecting Select Medical's products, and show how it may impact the firm outlook for active traders this year.

Published over a month ago

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Is Select Medical overvalued?

On a scale of 0 to 100, Select Medical holds a performance score of 10. The entity has a beta of 0.3201, which indicates possible diversification benefits within a given portfolio. Let's try to break down what Select's beta means in this case. As returns on the market increase, Select Medical returns are expected to increase less than the market. However, during the bear market, the loss on holding Select Medical will be expected to be smaller as well. Although it is vital to follow Select Medical Holdings current price movements, it is good to be conservative about what you can do with the information regarding equity historical returns. The philosophy towards measuring future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. By inspecting Select Medical Holdings technical indicators, you can presently evaluate if the expected return of 0.38% will be sustainable into the future. Please operates Select Medical maximum drawdown, as well as the relationship between the expected short fall and rate of daily change to make a quick decision on whether Select Medical Holdings existing price patterns will revert.

How important is Select Medical's Liquidity

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

How Select utilizes its cash?

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

Select Medical Net Cash Flow from Operations is relatively stable at the moment as compared to the past year. The company's current value of Net Cash Flow from Operations is estimated at 326.92 Million

Is Select Medical valued accurately by the market?

The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Select Medical has an asset utilization ratio of 124.18 percent. This denotes that the company is making $1.24 for each dollar of assets. An increasing asset utilization means that Select Medical Holdings is more efficient with each dollar of assets it utilizes for everyday operations.

Select Medical is estimated to stay under $29 in February

Risk adjusted performance is down to 0.16. It may denote a possible volatility pull down. Select Medical Holdings currently demonstrates below-verage downside deviation. It has Information Ratio of 0.08 and Jensen Alpha of 0.32. However, we do advice investors to further question Select Medical Holdings expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

The Bottom Line

While some other companies within the medical care facilities industry are still a little expensive, even after the recent corrections, Select Medical may offer a potential longer-term growth to stakeholders. In closing, as of the 24th of January 2021, our ongoing 30 days buy-or-sell advice on the company is Strong Hold. We believe Select Medical is currently fairly valued with below average odds of financial distress for the next two years.

About Contributor

Ellen Johnson is a Member of Macroaxs Editorial Board. Ellen covers public companies in North America, focusing primarily on valuation and volatility. Six years of experience in predictive investment analytics and risk management. 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 Ellen Johnson do not own shares of Select Medical Holdings. Please refer to our Terms of Use for any information regarding our disclosure principles.

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