In trying to determine how profitable a company is per asset dollar, we can take a look at the firm’s Return on Assets. Return on assets is calculated by dividing a company’s net income (usually annual income) by its total assets, and is displayed as a percentage. At the time of writing, SSR Mining Inc. (TSX:SSRM) has 0.017174 ROA. The measure is commonly used to compare the performance of businesses within the same industry, since it is very difficult for someone to obfuscate the cash flow figure. Thus, the ratio is quite a reliable and comparable measure of asset performance across an industry.
Stock market investors may be taking some time to review portfolio allocation. Rebalancing the portfolio may be necessary for some but not for others. Rebalancing the portfolio may help provide a strategy for when the market becomes highly volatile. This process may also help keep the investor buying low and selling high. Investors may also be looking at some different stocks to explore in the next few months. This may include reviewing some foreign markets or some new sectors that were previously not included in the stock portfolio. Completing all the necessary research is typically a good way to start building a more comprehensive pool of diversified stocks.
Valuation Scores
Checking in on some valuation rankings, SSR Mining Inc. (TSX:SSRM) has a Value Composite score of 44. Developed by James O’Shaughnessy, the VC score uses five valuation ratios. These ratios are price to earnings, price to cash flow, EBITDA to EV, price to book value, and price to sales. The VC is displayed as a number between 1 and 100. In general, a company with a score closer to 0 would be seen as undervalued, and a score closer to 100 would indicate an overvalued company. Adding a sixth ratio, shareholder yield, we can view the Value Composite 2 score which is currently sitting at 51.
SSR Mining Inc. (TSX:SSRM) has a current MF Rank of 9641. Developed by hedge fund manager Joel Greenblatt, the intention of the formula is to spot high quality companies that are trading at an attractive price. The formula uses ROIC and earnings yield ratios to find quality, undervalued stocks. In general, companies with the lowest combined rank may be the higher quality picks.
The price to book ratio or market to book ratio for SSR Mining Inc. (TSX:SSRM) currently stands at 1.508849. The ratio is calculated by dividing the stock price per share by the book value per share. This ratio is used to determine how the market values the equity. A ratio of under 1 typically indicates that the shares are undervalued. A ratio over 1 indicates that the market is willing to pay more for the shares. There are often many underlying factors that come into play with the Price to Book ratio so all additional metrics should be considered as well.
Ever wonder how investors predict positive share price momentum? The Cross SMA 50/200, also known as the “Golden Cross” is the fifty day moving average divided by the two hundred day moving average. The SMA 50/200 for SSR Mining Inc. (TSX:SSRM) is currently 1.10495. If the Golden Cross is greater than 1, then the 50 day moving average is above the 200 day moving average – indicating a positive share price momentum. If the Golden Cross is less than 1, then the 50 day moving average is below the 200 day moving average, indicating that the price might drop.
The Leverage Ratio of SSR Mining Inc. (TSX:SSRM) is 0.162413. Leverage ratio is the total debt of a company divided by total assets of the current and past year divided by two. Companies take on debt to finance their day to day operations. The leverage ratio can measure how much of a company’s capital comes from debt. With this ratio, investors can better estimate how well a company will be able to pay their long and short term financial obligations.
Volatility
Stock volatility is a percentage that indicates whether a stock is a desirable purchase. Investors look at the Volatility 12m to determine if a company has a low volatility percentage or not over the course of a year. The Volatility 12m of SSR Mining Inc. (TSX:SSRM) is 38.487100. This is calculated by taking weekly log normal returns and standard deviation of the share price over one year annualized. The lower the number, a company is thought to have low volatility. The Volatility 3m is a similar percentage determined by the daily log normal returns and standard deviation of the share price over 3 months. The Volatility 3m of SSR Mining Inc. (TSX:SSRM) is 39.487400. The Volatility 6m is the same, except measured over the course of six months. The Volatility 6m is 35.757500.
Quant Scores
The Q.i. Value of SSR Mining Inc. (TSX:SSRM) is 45.00000. The Q.i. Value is a helpful tool in determining if a company is undervalued or not. The Q.i. Value is calculated using the following ratios: EBITDA Yield, Earnings Yield, FCF Yield, and Liquidity. The lower the Q.i. value, the more undervalued the company is thought to be.
The Piotroski F-Score is a scoring system between 1-9 that determines a firm’s financial strength. The score helps determine if a company’s stock is valuable or not. The Piotroski F-Score of SSR Mining Inc. (TSX:SSRM) is 3. A score of nine indicates a high value stock, while a score of one indicates a low value stock. The score is calculated by the return on assets (ROA), Cash flow return on assets (CFROA), change in return of assets, and quality of earnings. It is also calculated by a change in gearing or leverage, liquidity, and change in shares in issue. The score is also determined by change in gross margin and change in asset turnover.
The M-Score, conceived by accounting professor Messod Beneish, is a model for detecting whether a company has manipulated their earnings numbers or not. SSR Mining Inc. (TSX:SSRM) has an M-Score of -2.800361. The M-Score is based on 8 different variables: Days’ sales in receivables index, Gross Margin Index, Asset Quality Index, Sales Growth Index, Depreciation Index, Sales, General and Administrative expenses Index, Leverage Index and Total Accruals to Total Assets. A score higher than -1.78 is an indicator that the company might be manipulating their numbers.
The Gross Margin Score is calculated by looking at the Gross Margin and the overall stability of the company over the course of 8 years. The score is a number between one and one hundred (1 being best and 100 being the worst). The Gross Margin Score of SSR Mining Inc. (TSX:SSRM) is 25.00000. The more stable the company, the lower the score. If a company is less stable over the course of time, they will have a higher score.
Often times, the stock market will be affected by political, social, or economic events. The result may be end up to be positive or negative. It is wise to remember that market fluctuations can happen at any time for many various reasons. Sometimes it may not be evident of why the market moved until long after the scene has played out. Making investment decisions in a turbulent climate may be extremely tricky. At some point, investors may find themselves on the wrong end of a trade. Staying vigilant in the markets may help investors bounce back after a temporary defeat. Investors who stay the course and stay with an investment plan may be able to better handle the ups and downs of daily market movements. Repeatedly trying to find the tops or bottoms is not an easy task. Even the most seasoned investors may not be able to successfully time the market.
Taking a look at some key metrics and ratios for Panda Green Energy Group Limited (SEHK:686), we note that the ROA or Return on Assets stands at 0.001603. Return on Assets shows how many dollars of earnings result from each dollar of assets the company controls. Return on assets gives an indication of the capital intensity of the company, which will also depend on the type of industry.
Even though the stock market can seem erratic and unpredictable, investors may be able to take some steps to help combat the chaos. One thing that investors have the ability to do is create an overall plan and stick to it. This may be one of the single most important factors in achieving success in the stock market. Of course, if something doesn’t seem to be working over an extended period of time, then maybe some action may need to be taken and the plan should be adjusted. Scrapping a plan too early may bring about a lot of unnecessary worry and confusion. Staying disciplined and keeping the proper perspective might help the investor better position themselves on the front lines.
In addition to ROA, there are a number of additional ratios and Quant signals available to investors in order to decipher if the shares are a good fit for their portfolio. The Shareholder Yield is a way that investors can see how much money shareholders are receiving from a company through a combination of dividends, share repurchases and debt reduction. The Shareholder Yield of Panda Green Energy Group Limited (SEHK:686) is -0.062495. This percentage is calculated by adding the dividend yield plus the percentage of shares repurchased. Dividends are a common way that companies distribute cash to their shareholders. Similarly, cash repurchases and a reduction of debt can increase the shareholder value, too. Another way to determine the effectiveness of a company’s distributions is by looking at the Shareholder yield (Mebane Faber). The Shareholder Yield (Mebane Faber) of Panda Green Energy Group Limited SEHK:686 is -0.69599. This number is calculated by looking at the sum of the dividend yield plus percentage of sales repurchased and net debt repaid yield.
The EBITDA Yield is a great way to determine a company’s profitability. This number is calculated by dividing a company’s earnings before interest, taxes, depreciation and amortization by the company’s enterprise value. Enterprise Value is calculated by taking the market capitalization plus debt, minority interest and preferred shares, minus total cash and cash equivalents. The EBITDA Yield for Panda Green Energy Group Limited (SEHK:686) is 0.056213.
The Earnings to Price yield of Panda Green Energy Group Limited SEHK:686 is 0.010878. This is calculated by taking the earnings per share and dividing it by the last closing share price. This is one of the most popular methods investors use to evaluate a company’s financial performance. Earnings Yield is calculated by taking the operating income or earnings before interest and taxes (EBIT) and dividing it by the Enterprise Value of the company. The Earnings Yield for Panda Green Energy Group Limited SEHK:686 is 0.033941. Earnings Yield helps investors measure the return on investment for a given company. Similarly, the Earnings Yield Five Year Average is the five year average operating income or EBIT divided by the current enterprise value. The Earnings Yield Five Year average for Panda Green Energy Group Limited (SEHK:686) is 0.011388.
The Price to book ratio is the current share price of a company divided by the book value per share. The Price to Book ratio for Panda Green Energy Group Limited SEHK:686 is 0.666471. A lower price to book ratio indicates that the stock might be undervalued. Similarly, Price to cash flow ratio is another helpful ratio in determining a company’s value. The Price to Cash Flow for Panda Green Energy Group Limited (SEHK:686) is 9.976402. This ratio is calculated by dividing the market value of a company by cash from operating activities. Additionally, the price to earnings ratio is another popular way for analysts and investors to determine a company’s profitability. The price to earnings ratio for Panda Green Energy Group Limited (SEHK:686) is 91.925423. This ratio is found by taking the current share price and dividing by earnings per share.
Quant
The Piotroski F-Score is a scoring system between 1-9 that determines a firm’s financial strength. The score helps determine if a company’s stock is valuable or not. The Piotroski F-Score of Panda Green Energy Group Limited (SEHK:686) is 4. A score of nine indicates a high value stock, while a score of one indicates a low value stock. The score is calculated by the return on assets (ROA), Cash flow return on assets (CFROA), change in return of assets, and quality of earnings. It is also calculated by a change in gearing or leverage, liquidity, and change in shares in issue. The score is also determined by change in gross margin and change in asset turnover.
The Gross Margin Score is calculated by looking at the Gross Margin and the overall stability of the company over the course of 8 years. The score is a number between one and one hundred (1 being best and 100 being the worst). The Gross Margin Score of Panda Green Energy Group Limited (SEHK:686) is 50.00000. The more stable the company, the lower the score. If a company is less stable over the course of time, they will have a higher score.
The ERP5 Rank is an investment tool that analysts use to discover undervalued companies. The ERP5 looks at the Price to Book ratio, Earnings Yield, ROIC and 5 year average ROIC. The ERP5 of Panda Green Energy Group Limited (SEHK:686) is 8850. The lower the ERP5 rank, the more undervalued a company is thought to be.
The M-Score, conceived by accounting professor Messod Beneish, is a model for detecting whether a company has manipulated their earnings numbers or not. Panda Green Energy Group Limited (SEHK:686) has an M-Score of -1.903969. The M-Score is based on 8 different variables: Days’ sales in receivables index, Gross Margin Index, Asset Quality Index, Sales Growth Index, Depreciation Index, Sales, General and Administrative expenses Index, Leverage Index and Total Accruals to Total Assets. A score higher than -1.78 is an indicator that the company might be manipulating their numbers.
The Value Composite One (VC1) is a method that investors use to determine a company’s value. The VC1 of Panda Green Energy Group Limited (SEHK:686) is 39. A company with a value of 0 is thought to be an undervalued company, while a company with a value of 100 is considered an overvalued company. The VC1 is calculated using the price to book value, price to sales, EBITDA to EV, price to cash flow, and price to earnings. Similarly, the Value Composite Two (VC2) is calculated with the same ratios, but adds the Shareholder Yield. The Value Composite Two of Panda Green Energy Group Limited (SEHK:686) is 49.
Investors often have to calculate risk/reward scenarios when navigating the equity market. Keeping track of alternatives and gauging the likelihood of certain outcomes can help with designing a legitimate strategy. When all the research and planning has been completed, there may come a time when the investor has to make a decision and get ready to take some action. There will obviously be some trades that work out great and others that don’t. Accepting the fact that this is part of the process can help keep the investor focused on the next trade instead of lamenting the past.