By analyzing existing technical indicators between Workhorse and Toyota, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Toyota with a short position in Workhorse. Check out our
pair correlation module for more information.
Let's begin by analyzing the assets. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Workhorse has an asset utilization ratio of 1.25 percent. This connotes that the company is making $0.0125 for each dollar of assets. An increasing asset utilization means that Workhorse Group is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two entities, such as Workhorse or Goodyear is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.
How important is Workhorse's Liquidity
Workhorse
financial leverage refers to using borrowed capital as a funding source to finance Workhorse Group ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Workhorse 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 Workhorse's 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 Workhorse's 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 Workhorse's total debt and its cash.
Correlation Between Workhorse and Goodyear Tire Rubber
In general, Stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Workhorse together with similar or unrelated positions with a negative correlation. For example, you can also add Goodyear Tire to your portfolio. If Goodyear Tire is not perfectly correlated to Workhorse it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Workhorse, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Are you currently holding both Workhorse and Goodyear Tire in your portfolio? Please note if you are using this as a pair-trade strategy between Workhorse and Goodyear Tire, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses. Please check
pair correlation details between WKHS and GT for more information.
What is the case for Workhorse Investors
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.
Revenue Breakdown
Lets now check Workhorse revenue. Based on the latest financial disclosure, Workhorse Group reported 183.11
K of revenue. This is 100.0% lower than that of the Consumer Cyclical sector and 100.0% lower than that of the
Auto Manufacturers industry. The revenue for all United States stocks is 100.0% higher than that of Workhorse. As for Toyota we see revenue of 271.18
B, which is 181.68% higher than that of the Auto Manufacturers
| WKHS | 183,110 | 6.6E-5 |
| Sector | 7.13 Billion | 2.56 |
| TM | 271.18 Billion | 97.44 |
Over 3 percent spike for Workhorse. What does it mean for retail investors?
Latest market risk adjusted performance is at 6.78. Workhorse Group is displaying above-average volatility over the selected time horizon. Investors should scrutinize Workhorse Group independently to ensure intended market timing strategies are aligned with expectations about Workhorse volatility.
The Bottom Line
While other entities within the auto manufacturers industry are still a little expensive, even after the recent corrections, Workhorse may offer a potential longer-term growth to retail investors. To conclude, as of the 6th of September 2020, our final 30 days buy-or-sell advice on the enterprise is
Strong Sell. We believe Workhorse is currently
overvalued with
below average probability of financial unrest for the next two years.
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Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, 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 Vlad Skutelnik do not own shares of Workhorse Group. Please refer to our
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