The company conducts business under
Healthcare sector and is part of
Drug Manufacturers—Specialty & Generic industry.
Investing in 22nd Century, 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 22nd Century 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, anticipate that the market will even out over time. This tendency of 22nd Century'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 note, it is not enough to conduct a financial or market analysis of a single entity such as 22nd Century. Your research has to be compared to or analyzed against 22nd Century's peers to derive any actionable benefits. When done correctly, 22nd Century's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy toward taking a position in 22nd Century Group.
How important is 22nd Century's Liquidity
22nd Century
financial leverage refers to using borrowed capital as a funding source to finance 22nd Century Group ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. 22nd Century 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 22nd Century'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 22nd Century'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 22nd Century's total debt and its cash.
22nd Century Gross Profit
22nd Century Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing 22nd Century 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 22nd Century Gross Profit growth over the last 10 years. Please check 22nd Century's
gross profit and other
fundamental indicators for more details.
22nd Century Correlation with Peers
Investors in 22nd can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in 22nd Century Group. Diversification will allow for the same portfolio return with reduced risk. The correlation table of 22nd Century and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities 22nd 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 22nd for more details
Breaking down the case for 22nd Century
22nd Century is very risky given 1 month investment horizon.
22nd Century Group secures Sharpe Ratio (or Efficiency) of 0.16, which signifies that the company had 0.16% of return per unit of standard deviation over the last month. Our approach to foreseeing the risk of a stock is to use both market data as well as company specific technical data. We were able to collect and analyze data for twenty-one different
technical indicators, which can help you to evaluate if expected returns of 1.25% are justified by taking the suggested risk. Use 22nd Century Semi Deviation of 6.53,
coefficient of variation of 574.45, and Mean Deviation of 5.88 to evaluate company specific risk that cannot be
diversified away.
Another 3 percent rise for 22nd Century
Current maximum drawdown is at 30.17.
As of the 24th of April, 22nd Century shows the Mean Deviation of 5.88,
coefficient of variation of 574.45, and Semi Deviation of 6.53. Concerning
fundamental indicators, the
technical analysis model gives you tools to check possible technical drivers of 22nd Century, as well as the relationship between them. Put another way, you can use this information to find out if the entity will indeed mirror its model of
historical prices and volume momentum, or the prices will eventually revert. We were able to collect and analyze data for nineteen
technical drivers for 22nd Century Group, which can be compared to its rivals. Please confirm
22nd Century Group variance,
value at risk, as well as the
relationship between the Value At Risk and
skewness to decide if 22nd Century Group is priced adequately, providing market reflects its regular price of 5.15 per share. Given that 22nd Century has
jensen alpha of 1.01, we suggest you to validate 22nd Century Group's prevailing market performance to make sure the company can sustain itself in the future.
Our Final Takeaway
While some other firms under the drug manufacturers—specialty & generic industry are still a bit expensive, 22nd Century may offer a potential longer-term growth to stockholders. To conclude, as of the 24th of April 2021, we believe 22nd Century is currently
overvalued. It hyperactively responds to market trends and projects
below average odds of financial distress in the next two years. Our overall 30 days buy-hold-sell advice on the company is
Hold.
Building efficient market-beating portfolios requires time, education, and a lot of computing power!
The Portfolio Architect is an AI-driven system that provides multiple benefits to our users by leveraging cutting-edge machine learning algorithms, statistical analysis, and predictive modeling to automate the process of asset selection and portfolio construction, saving time and reducing human error for individual and institutional investors.
Try AI Portfolio ArchitectEditorial Staff
Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce.
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 Rifka Kats do not own shares of 22nd Century Group. Please refer to our
Terms of Use for any information regarding our disclosure principles.
Would you like to provide feedback on the content of this article?
You can get in touch with us directly or send us a quick note via email to
editors@macroaxis.com
