Encore Capital ascents 0.69
 | By Vlad Skutelnik | Macroaxis Story |
In this story I am going to address all Encore Capital shareholders. I will look into why despite regular market tumult, the longer-term fundamental drivers of the firm are still sound. Encore Capital Revenue Per Employee is expected to significantly decrease based on the last few years of reporting. The last year's Revenue Per Employee was at 198,270. The current year Market Capitalization is expected to grow to about 1.1 B, whereas Earnings Before Interest Taxes and Depreciation Amortization EBITDA are expected to decline to about 493.8 M. The company Piotroski F Score is 7 - Strong. Given the investment horizon of 30 days, Encore Capital is expected to under-perform the market. In addition to that, the company is 1.56 times more volatile than its market benchmark. It trades about -0.01 of its total potential returns per unit of risk. The market is currently generating roughly 0.1 per unit of volatility. We found thirty-five available fundamental indicators for Encore Capital Group which can be compared to its rivals. To make sure the equity is not overpriced, please confirm all Encore Capital Group fundamentals including its Gross Profit, Book Value Per Share and the relationship between Price to Earning and Cash per Share . Given that Encore Capital Group has Number of Shares Shorted of 6.42 M, we urge you verify Encore Capital Group prevailing market performance to make sure the company can sustain itself down the road. Use Encore Capital to enhance returns of your portfolios. The stock experiences moderate upward volatility. Check odds of Encore Capital to be traded at $38.5 in 30 days.
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Reviewed by Gabriel Shpitalnik
ENCORE CAPITAL GR currently holds roughly 186.84 M in cash with 22.05 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 6.02. This firm dividends can provide a clue to current valuation of the stock. Encore Capital is not expected to issue dividends this year as it trying to preserve or re-invest any of the funds available for distribution to stakeholders.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Encore Capital. Your research has to be compared to or analyzed against Encore Capital's peers to derive any actionable benefits. When done correctly, Encore Capital'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 Encore Capital Group.
Investing in Encore Capital, 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 Encore Capital 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 Encore Capital'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.
How important is Encore Capital's Liquidity
Encore Capital financial leverage refers to using borrowed capital as a funding source to finance Encore Capital Group ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Encore Capital 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 Encore Capital'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 Encore Capital'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 Encore Capital's total debt and its cash.
Encore Capital Gross Profit
Encore Capital Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Encore Capital 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 Encore Capital Gross Profit growth over the last 10 years. Please check Encore Capital's gross profit and other fundamental indicators for more details.
Encore Capital Correlation with Peers
Investors in Encore can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Encore Capital Group. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Encore Capital and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Encore 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 Encore for more details
Going after Encore Financials
The small decline in market price for the last few months could raise concerns from investors as the firm closed today at a share price of 34.88 on 132821 in volume. The company executives did not add much value to Encore Capital investors in January. However, diversifying your holdings with Encore Capital Group or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 30 days (very short) investing horizon is currently 1.53. The below-average Stock volatility is a good sign for a longer term investment options and for buy-and-hold investors. Encore Capital makes 49.57 probability of bankruptcy. Encore Capital is selling for 35.00. This is 0.69 percent increase. Today lowest is 34.88. Encore Capital Net Income Per Employee is decreasing over the last 8 years. Moreover, Encore Capital Earnings Before Interest Taxes and Depreciation Amortization USD is rather stable at the moment. To summarize, our primary buy/sell recommendation on the firm is Strong Hold. We believe Encore Capital is under valued with close to average odds of financial turmoil for the next two years.
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