TravelCenters (NASDAQ:TA) high volatility trend continues
 | By Ellen Johnson | Macroaxis Story |
TravelCenters is generating 1.0657% of daily returns and assumes 5.9008% volatility on return distribution over the 60 days horizon. While some of us are excited about consumer cyclical space, it makes sense to go over TravelCenters in greater detail to make a better estimate of its risk and reward. We will evaluate if the latest TravelCenters price volatility suggests a bounce in December. TravelCenters high volatility, while potentially profitable, can lead to more considerable losses for your portfolios.
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Reviewed by Michael Smolkin
The company is active under Consumer Cyclical sector as part of Specialty Retail industry. TravelCenters holds a performance score of 12 on a scale of zero to a hundred. The entity has a beta of 0.295, which indicates not very significant fluctuations relative to the market. Let's try to break down what TravelCenters's beta means in this case. As returns on the market increase, TravelCenters returns are expected to increase less than the market. However, during the bear market, the loss on holding TravelCenters will be expected to be smaller as well. Although it is vital to follow TravelCenters Of Ame current price movements, it is good to be conservative about what you can do with the information regarding equity historical returns. Our philosophy towards measuring future performance of any stock is to look not only at its past charts but also at the business as a whole, including all fundamental and technical indicators. To evaluate if TravelCenters Of America expected return of 1.07 will be sustainable into the future, we have found twenty-eight different technical indicators, which can help you to check if the expected returns are sustainable. Use TravelCenters Of Ame information ratio, downside variance, day median price, as well as the relationship between the treynor ratio and kurtosis to analyze future returns on TravelCenters Of Ame. Volatility is a rate at which the price of TravelCenters 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 TravelCenters may increase or decrease. In other words, similar to TravelCenters's beta indicator, it measures the risk of TravelCenters and helps estimate the fluctuations that may happen in a short period of time. So if prices of TravelCenters 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 TravelCenters's Liquidity
TravelCenters financial leverage refers to using borrowed capital as a funding source to finance TravelCenters Of America ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. TravelCenters 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 TravelCenters' 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 TravelCenters' 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 TravelCenters's total debt and its cash.
Breaking down TravelCenters Indicators
TravelCenters Of Ame generated the yearly revenue of 5.38 B. Reported Net Income was 27.5 M with gross profit of 511.39 M.
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