Westrock Story

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WRK -- USA Stock  

USD 44.21  0.66  1.47%

It feels like Westrock may not recover as fast as we have hopped for as its price went down 2.65% today. The entity current daily volatility is 2.57 percent, with a beta of 1.71 and an alpha of -0.09 over DOW. Whilst many millenniums are getting more into investing against high market volatility, it is quite pruden to examine Westrock Company based on its historical prices. We will look into some reasons why it is still possible for Westrock to maintain above-average margins while minimizing volatility.
Published over three weeks ago
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Is Westrock (NYSE:WRK) a new disruptor?
Westrock Company has roughly 251.1 M in cash with 2.07 B of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 0.96. Westrock has performance score of 4 on a scale of 0 to 100. The firm maintains a market beta of 1.711, which attests to a somewhat significant risk relative to the market. Let's try to break down what Westrock'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, Westrock will likely underperform. Although it is extremely important to respect Westrock historical price patterns, it is better to be realistic regarding the information on equity current price history. The philosophy towards determining future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. By examining Westrock technical indicators, you can presently evaluate if the expected return of 0.18% will be sustainable into the future. Westrock right now maintains a risk of 2.57%. Please check out Westrock downside variance, as well as the relationship between the accumulation distribution and market facilitation index to decide if Westrock will be following its historical returns.
Investing in Westrock, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Westrock along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Westrock's stock 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 Westrock in the context of predictive analytics.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Westrock. Your research has to be compared to or analyzed against Westrock's peers to derive any actionable benefits. When done correctly, Westrock'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 Westrock.

How important is Westrock's Liquidity

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

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Westrock, but it might be worth checking our own buy vs. sell analysis

Westrock Correlation with Peers

Investors in Westrock can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Westrock Company. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Westrock and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Westrock is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage.
Please check volatility of Westrock for more details

A Deeper Perspective

We consider Westrock very steady. Westrock shows Sharpe Ratio of 0.07, which attests that the company had 0.07% of return per unit of risk over the last month. Our standpoint towards determining the volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Westrock, which you can use to evaluate future volatility of the company. Please check out Westrock Market Risk Adjusted Performance of 0.0536, downside deviation of 2.47, and Mean Deviation of 2.03 to validate if the risk estimate we provide is consistent with the expected return of 0.18%.
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0.590.420.440.5
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Click cells to compare fundamentals   Check Volatility   Backtest Portfolio

How will Westrock traders react to the next plunge?

Recent Skewness is up to 0.1. Price may plunge again. Westrock Company currently demonstrates below-verage downside deviation. It has Information Ratio of -0.01 and Jensen Alpha of -0.09. However, we do advice investors to further question Westrock Company expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

Our Bottom Line On Westrock

Although some other companies in the packaging & containers industry are either recovering or due for a correction, Westrock may not be as strong as the others in terms of longer-term growth potentials. To conclude, as of the 28th of January 2021, we believe that at this point, Westrock is undervalued with close to average probability of bankruptcy within the next 2 years. Our primary 'Buy-Sell' recommendation on the firm is Hold.

About Contributor

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 Achuva Shats do not own shares of Westrock Company. Please refer to our Terms of Use for any information regarding our disclosure principles.

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