By examining key indicators for SW Seed and Alico, you can assess how market fluctuations impact their stock prices and determine if combining them in a portfolio might reduce risk. Pair trading strategies are also an option, where you take a long position in Alico and a short position in SW Seed. For more details, explore our [pair correlation](https://example.com) module.
Now, let's look at asset utilization. This metric shows how much revenue a company generates for each dollar of assets. SW Seed's asset utilization ratio is 50.07%, meaning it earns $0.50 for every dollar of assets. A rising asset utilization ratio suggests that SW Seed is becoming more efficient in using its assets for daily operations.
Major Takeaways
With S&W Seed Company's market capitalization at just
15M and an EBITDA loss of
10M, the stock presents a compelling short opportunity given its financial struggles.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two entities, such as SANW or Alico is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.
How important is SW Seed's Liquidity
SW Seed
financial leverage refers to using borrowed capital as a funding source to finance SW Seed Company ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. SW Seed 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 SW Seed'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 SW Seed'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 SW Seed's total debt and its cash.
Correlation Between SANW and Alico Inc
In general, Stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding SW Seed together with similar or unrelated positions with a negative correlation. For example, you can also add Alico to your portfolio. If Alico is not perfectly correlated to SW Seed it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When SW Seed, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Are you currently holding both SW Seed and Alico in your portfolio? Please note if you are using this as a pair-trade strategy between SW Seed and Alico, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses. Please check
pair correlation details between SANW and ALCO for more information.
Breaking it down a bit more
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.
Revenue Breakdown
Let me now analyze SW Seed revenue. Based on the latest financial disclosure, SW Seed Company reported 60.44
M of revenue.
This is 99.59% lower than that of the Food Products sector and 99.41% lower than that of the
Consumer Staples industry. The revenue for all United States stocks is 99.36% higher than that of SW Seed. As for Alico we see revenue of 39.85
M, which is 99.61% lower than that of the Consumer Staples
| SANW | 60.44 Million | 0.63 |
| Sector | 9.43 Billion | 98.95 |
| ALCO | 39.85 Million | 0.42 |
Warren Buffett once said, "Price is what you pay; value is what you get." This sentiment rings true when evaluating the potential short opportunities in S&W Seed Company. Despite a market capitalization of just $15.01 million, the company faces significant financial challenges, including a profit margin of 50% losses and a negative operating margin of 27%. With a debt-to-equity ratio of 0.91%, the company's financial leverage is relatively high, which, coupled with a probability of bankruptcy at 76.26%, raises concerns about its financial stability. These factors, alongside a low price-to-sales ratio of 0.25X, suggest that investors might consider a strategic short position, betting on further declines in the stock's value..
Will SW Seed latest climb continue?
SW Seed Company's stock has recently piqued investor interest, and there's a solid reason for it. The coefficient of variation, which measures risk relative to return, has dropped to 1586.45. This suggests the stock's price movements are becoming more stable, potentially appealing to risk-averse investors interested in the agricultural sector. As the company progresses, market watchers are eager to see if this trend continues, possibly leading to further gains. Despite this, SW Seed still exhibits above-average volatility. Understanding these volatility patterns can help investors make informed decisions. During bear markets, heightened volatility can affect SW Seed's stock price, causing concern among investors. This often leads them to adjust their portfolios by acquiring different assets as prices decline.
Our Takeaway on SW Seed Investment
While some other companies under the farm products industry are still a bit expensive, SW Seed may offer a potential longer-term growth to sophisticated investors. With a less-than optimistic outlook for your 90 days horizon, it may be a good time to drop some or all of your SW Seed holdings as it seems the potential growth was already fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to SW Seed.
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Aina Ster is a Member of Macroaxis Editorial Board. Aina delivers weekly perspective on ongoing market and economic trends, analysis and tips from predictive analysis to forecasting across various financial instruments.
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 Aina Ster do not own shares of SW Seed Company. Please refer to our
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