Will Stereotaxis (AMEX:STXS) fall in March?

40% of stocks are less volatile than Stereotaxis, and 83% of all traded equity instruments are projected to make higher returns than the company over the 90 days investment horizon. While some risk-loving traders are indifferent towards current market volatility, it is reasonable to sum up the risk of investing in Stereotaxis. We will discuss if the expected returns on Stereotaxis will justify its current volatility.
Published over a year ago
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Reviewed by Michael Smolkin

The company currently holds 4.97 M in liabilities with Debt to Equity (D/E) ratio of 0.12, which may suggest Stereotaxis is not taking enough advantage from borrowing. Stereotaxis has a current ratio of 3.93, suggesting that it is liquid enough and is able to pay its financial obligations when due.
Volatility is a rate at which the price of Stereotaxis 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 Stereotaxis may increase or decrease. In other words, similar to Stereotaxis's beta indicator, it measures the risk of Stereotaxis and helps estimate the fluctuations that may happen in a short period of time. So if prices of Stereotaxis 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 Stereotaxis's Liquidity

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

Stereotaxis Volatility Drivers

Stereotaxis unsystematic risk is unique to Stereotaxis and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Stereotaxis you can also buy EUDA Health Holdings. You can also mitigate this risk by investing in the health care sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Stereotaxis important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Stereotaxis income statement and balance sheet. Here are more details about Stereotaxis volatility.

Details

The entity reported the previous year's revenue of 26.7 M. Net Loss for the year was (7.94 M) with profit before overhead, payroll, taxes, and interest of 22.77 M.

Our take on today Stereotaxis spike

Stereotaxis latest jensen alpha advances over 0.4. Stereotaxis currently demonstrates below-average downside deviation. It has Information Ratio of 0.14 and Jensen Alpha of 0.4. However, we advise investors to further question Stereotaxis expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Stereotaxis' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Stereotaxis' 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 Final Perspective on Stereotaxis

While many of the other players under the medical instruments & supplies industry are still a bit expensive, Stereotaxis may offer a potential longer-term growth to retail investors. With an optimistic outlook on your 30 days horizon, it may be a good time to trade new shares of Stereotaxis or increase your existing holdings in the Stock as it seems the potential growth has not yet been 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 Stereotaxis.

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Editorial Staff

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 Stereotaxis. Please refer to our Terms of Use for any information regarding our disclosure principles.

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