The average rating for Yirendai's stock is 'Hold', as determined by three analysts. Is this consensus based on technical analysis? We understand that conventional technical analysis employs price momentum, patterns, and trends by examining historical prices. Its goal is to identify signals based on the market sentiment of Yirendai's investors and their perception of the company's future value. Let's delve into a few aspects of Yirendai's technical analysis.
Important Points
Yirendai (USA Stocks: YRD), a prominent player in the Credit Services industry, has been showing promising signs from a technical perspective. The stock has recently seen a price change of
0.17, representing a price percent change of
6.54%, which indicates a potential bullish surge. The company's low PE Ratio of
0.9848 further supports this bullish outlook, suggesting that the stock is currently undervalued. Moreover, Yirendai has a strong operating income of
1.1B, demonstrating its financial stability and potential for future growth. However, investors should also consider the company's maximum drawdown of
9.85, which indicates the potential risk involved. In conclusion, Yirendai appears to be a promising investment opportunity this December, but investors should also consider the potential risks.
Using predictive
technical analysis, we can analyze different prices and returns patterns and
diagnose historical swings to determine the real value of Yirendai. In general, sophisticated investors focus on analyzing Yirendai stock price patterns and their correlations with different microeconomic environment and drivers. They apply predictive analytics to build Yirendai'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
Yirendai's intrinsic value. In addition to deriving basic predictive indicators for Yirendai, many experienced traders also check how macroeconomic factors affect Yirendai price patterns. Please read more on our
technical analysis page or use our predictive modules below to complement your research.
How important is Yirendai's Liquidity
Yirendai
financial leverage refers to using borrowed capital as a funding source to finance Yirendai ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Yirendai 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 Yirendai'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 Yirendai'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 Yirendai's total debt and its cash.
Yirendai Gross Profit
Yirendai Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Yirendai 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 Yirendai Gross Profit growth over the last 10 years. Please check Yirendai's
gross profit and other
fundamental indicators for more details.
Closer look at Yirendai Semi Variance
Yirendai has current Semi Variance of 8.77. Semi-variance provides a good measure of downside volatility for equity or a portfolio. It is similar to variance, but it only looks at periods where the returns are less than the target or average level.
Semi-variance is the square of semi-deviation. Semi-variance is calculated by averaging the deviations of returns that have a result that is less than the mean.
Semi Variance | = | SUM(RET DEV)2 N(ZERO) |
| = | 8.77 |
| SUM | = | Summation notation |
| RET DEV | = | Actual return deviation over selected period |
| N(ZERO) | = | Number of points with returns less than zero |
Let's now compare Yirendai Semi Variance to its closest peers:
| YRD | 8.771156793938008 |
| AIU | 3.43 |
| SKX | 2.74 |
| VRA | 3.41 |
| RBC | 4.19 |
Every cloud has a silver lining, and for Yirendai (USA Stocks: YRD), the silver lining might just be a bullish surge this December. Despite a Probability of Bankruptcy at 35.73%, the company's strong financials suggest a potential upside.
With a Net Asset of
7.74B and a Working Capital of
6.71B, Yirendai's financial stability is evident. The company's 50 Day MA and 200 Day MA stand at 2.3594 and 2.4396 respectively, indicating a potential for price growth. Moreover, the company's Beta of 0.77 suggests less volatility compared to the market, making it a safer bet for investors. The Short Percent of 0.0012 also indicates a low level of short interest, further supporting the bullish outlook. However, investors should be cautious of the company's high Kurtosis of 3, which indicates a higher risk of extreme outcomes. .
Our perspective of the latest Yirendai surge
The recent semi deviation of 2.96 for Yirendai indicates a potential risk for investors. Despite the stock's recent surge, the elevated semi deviation suggests a higher likelihood of extreme negative returns. This implies that the stock's volatility is significantly high, and its price movements have been notably erratic. While the surge may be appealing to some investors, the high semi deviation advises caution. Therefore, even though the recent surge may suggest positive momentum, investors should weigh the risk associated with the stock's high volatility before making a decision. Yirendai exhibits above-average downside volatility for the selected time horizon. We recommend investors to further examine Yirendai and ensure that all
market timing and asset allocation strategies align with the forecast of Yirendai's future alpha. Understanding different
market volatility trends often assists investors in timing the market. Proper utilization of volatility indicators allows traders to gauge Yirendai's stock risk against market volatility during both bullish and bearish trends. The increased level of volatility that accompanies bear markets can directly affect
Yirendai's stock price, adding stress to investors as they watch the value of their shares plummet.
This typically compels investors to rebalance their portfolios by purchasing different stocks as prices decline. In conclusion, Yirendai (USA Stocks: YRD) presents a complex investment scenario. With a fiscal year end in December, the company's current valuation market value stands at
2.77, slightly below its valuation hype value of 2.78. The naive expected forecast value is 2.85, indicating a potential for growth. However, the analyst overall consensus is to 'Hold', with two analysts recommending 'Buy' and one indicating a 'Strong Sell'. The analyst target price estimated value is 5.656, suggesting a possible upside price of 6.21. On the other hand, the possible downside price is a mere 0.0277. The highest estimated target price by analysts is a staggering
20.2M, while the lowest is 0.0. This vast range indicates significant uncertainty in the market's perception of Yirendai's
future performance. Given these factors, investors should tread carefully and consider their risk tolerance and investment objectives before investing in Yirendai. .
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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.
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