Still holding on to Workhorse (NASDAQ:WKHS) given latest volatility fall?
 | By Vlad Skutelnik | Macroaxis Story |
Workhorse Grp is currently does not generate positive expected returns and assumes 9.9992% risk (volatility on return distribution) over the 90 days horizon. As many old-fashioned traders are trying to avoid consumer cyclical space, it makes sense to sum up Workhorse Grp a little further and try to understand its current volatility patterns. We will go over a few points Workhorse Grp retail investors should remember regarding its volatility.
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Reviewed by Raphi Shpitalnik
Workhorse Grp currently holds 199.11 M in liabilities with Debt to Equity (D/E) ratio of 0.5, which is about average as compared to similar companies. This firm has a current ratio of 16.18, suggesting that it is liquid enough and is able to pay its financial obligations when due.
The firm maintains a market beta of -0.7711, which attests to possible diversification benefits within a given portfolio. Let's try to break down what Workhorse's beta means in this case. As returns on the market increase, returns on owning Workhorse Grp are expected to decrease at a much lower rate. During the bear market, Workhorse Grp is likely to outperform the market. Even though it is essential to pay attention to Workhorse Grp historical price patterns, it is always good to be careful when utilizing equity current price history. Our philosophy towards determining any stock's future performance is to check both, its past performance charts as well as the business as a whole, including all available technical indicators. Workhorse Grp exposes twenty-one different technical indicators, which can help you to evaluate its performance. Workhorse Grp has an expected return of -0.37%. Please be advised to check out Workhorse Grp jensen alpha and downside variance to decide if Workhorse Grp stock performance from the past will be repeated at some point in the near future.
Volatility is a rate at which the price of Workhorse 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 Workhorse may increase or decrease. In other words, similar to Workhorse's beta indicator, it measures the risk of Workhorse and helps estimate the fluctuations that may happen in a short period of time. So if prices of Workhorse 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. 
Watch out for price decline
Please consider monitoring Workhorse on a daily basis if you are holding a position in it. Workhorse is trading at a penny-stock level, and the possibility of delisting is much higher compared to other 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 Workhorse stock to be traded above the $1 level to remain listed. If Workhorse 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 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.
Workhorse Gross Profit
Workhorse Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Workhorse previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Workhorse Gross Profit growth over the last 10 years. Please check Workhorse's gross profit and other fundamental indicators for more details.
Workhorse Volatility Drivers
Workhorse unsystematic risk is unique to Workhorse Group 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 Workhorse you can also buy Lordstown Motors Corp. You can also mitigate this risk by investing in the consumer discretionary 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 Workhorse 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 Workhorse income statement and balance sheet. Here are more details about Workhorse volatility.Click cells to compare fundamentals
What is the case for Workhorse Investors
The company reported the previous year's revenue of 1.39 M. Net Income was 69.78 M with loss before overhead, payroll, taxes, and interest of (11.67 M).
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