Sunworks (NASDAQ:SUNW) continues to climb
 | By Ellen Johnson | Macroaxis Story |
In this post, we will focus on Sunworks. We will evaluate if Sunworks shares are reasonably priced going into February. Here I will also expose some primary fundamental factors affecting Sunworks' services, and outline how it will impact the outlook for investors this year.
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Reviewed by Raphi Shpitalnik
The company reported the previous year's revenue of 43.7 M. Net Loss for the year was (14.45 M) with profit before overhead, payroll, taxes, and interest of 6.66 M. The company has Profit Margin (PM) of (33.07) %, which may suggest that it does not properly executes on its current pricing strategies or is unable to control all of the operational costs. This is way below average. Similarly, it shows Operating Margin (OM) of (22.17) %, which suggests for every $100 dollars of sales, it generated a net operating loss of -0.22. The performance of Sunworks in the marketplace will significantly impact your decision to invest in its stock. Revenue growth, profitability, competitive positioning, management quality, and industry trends can influence Sunworks' stock prices. When investing in Sunworks, there are several factors to consider and potential outcomes to expect. As a company performs well, its stock price may increase, allowing investors to benefit from price appreciation. However, Sunworks Stock can experience significant price fluctuations due to market conditions, economic factors, industry trends, or company-specific news. This is why investing in stocks such as Sunworks carries risks, including the potential for capital loss. Stock prices can decline, and investors may incur losses if they sell shares at a lower price than their initial investment.
Watch out for price decline
Please consider monitoring Sunworks on a daily basis if you are holding a position in it. Sunworks 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 Sunworks stock to be traded above the $1 level to remain listed. If Sunworks 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 Sunworks's Liquidity
Sunworks financial leverage refers to using borrowed capital as a funding source to finance Sunworks ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Sunworks 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 Sunworks' 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 Sunworks' 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 Sunworks's total debt and its cash.
Breaking it down a bit more
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Sunworks has an asset utilization ratio of 93.43 percent. This indicates that the company is making $0.93 for each dollar of assets. An increasing asset utilization means that Sunworks is more efficient with each dollar of assets it utilizes for everyday operations.
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