Our recent technical analysis of Ultralife (USA Stocks:ULBI)

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ULBI Stock  USD 3.93  0.01  0.26%   
Ellen Johnson
By Ellen Johnson
Macroaxis Story
As many of us are excited about electrical equipment space, it is fair to examine Ultralife within current market trends. As expected, Ultralife is starting to reaffirm its true potential as traders are becoming more and more confident in the future outlook. The returns on the market and returns on Ultralife appear somewhat correlated for the last few months. The sign of strong fundamental drivers of the firm signifies a short-horizon price swing for traders of Ultralife. Ultralife is scheduled to announce its earnings today.
Published over a month ago
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Reviewed by Raphi Shpitalnik

The company's average rating is Strong Buy from 1 analysts. Do analysts base this consensus on technical analyses? We know that typical technical analysis utilizes price momentum, patterns, and trends looking at historical prices. It aims to identify signals based on Ultralife market sentiment investors' perception of the future value of Ultralife. Let us look at a few aspects of Ultralife technical analysis.
Using predictive technical analysis, we will analyze different prices and returns patterns and diagnose historical swings to determine the real value of Ultralife. In general, we focus on analyzing Ultralife stock price patterns and their correlations with different microeconomic environment and drivers. We also apply predictive analytics to build Ultralife's daily price indicators and compare them against related drivers such as momentum indicators and various other types of predictive indicators. Using this methodology combined with a more conventional technical analysis and fundamental analysis, we attempt to find the most accurate representation of Ultralife's intrinsic value. In addition to deriving basic predictive indicators for Ultralife, we also check how macroeconomic factors affect Ultralife price patterns. Please read more on our technical analysis page or use our predictive modules below to complement your research.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Ultralife'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. Please use the tools below to analyze the current value of Ultralife in the context of predictive analytics.
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Please note, it is not enough to conduct a financial or market analysis of a single entity such as Ultralife. Your research has to be compared to or analyzed against Ultralife's peers to derive any actionable benefits. When done correctly, Ultralife's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy towards taking a position in Ultralife.

How important is Ultralife's Liquidity

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

How does Ultralife utilize its cash?

To perform a cash flow analysis of Ultralife, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Ultralife is receiving and how much cash it distributes out in a given period. The Ultralife cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Ultralife Net Cash Flow from Operations is increasing as compared to previous years. The last year's value of Net Cash Flow from Operations was reported at 4.97 Million

Purchase by Bradford Whitmore of 5562 shares of Ultralife

Legal trades by Ultralife insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Ultralife insider trading alert for perchase of common stock by Bradford Whitmore, the corporate stakeholder, on 13th of March 2023. This event was filed by Ultralife Corp with SEC on 2023-03-13. Statement of changes in beneficial ownership - SEC Form 4. Bradford Whitmore currently serves as independent chairman of the board of Ultralife [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down Ultralife Further

Ultralife has a beta of 0.8474. Let's try to break down what Ultralife'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, Ultralife will likely underperform. The beta indicator helps investors understand whether Ultralife 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 Ultralife deviates very little from the market, it does not add much risk to the portfolio, but it also doesn't increase the expected returns.
Ultralife price plunge over the last few months created some momentum for traders as it was traded today as low as 4.02 and as high as 4.04 per share. The company executives were not very successful in positioning the company resources to exploit market volatility in January. However, diversifying your holdings with Ultralife or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 2.5. The current volatility is consistent with the ongoing market swings in January 2023 as well as with Ultralife unsystematic, company-specific events.

Some Ultralife technical indicators suggest reversion

The market risk adjusted performance is down to -0.22 as of today. Ultralife exhibits very low volatility with skewness of 0.32 and kurtosis of 2.13. However, we advise investors to further study Ultralife technical indicators to ensure that all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Ultralife's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Ultralife's 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 Take On Ultralife

Although other entities in the electrical equipment & parts industry are either recovering or due for a correction, Ultralife may not be as strong as the others in terms of longer-term growth potentials. While some traders may not share our view, we believe that right now is not a good time to increase your holdings in Ultralife. 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 Ultralife.

Editorial Staff

Ellen Johnson is a Member of Macroaxis 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 Ultralife. Please refer to our Terms of Use for any information regarding our disclosure principles.

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