Are Wrap (USA Stocks:WRAP) retail investors starting to hold back?

Wrap Technologies has a beta of 2.1785. This suggests that the company is likely to outperform the market when it is on an upward trend. Conversely, if the market experiences negative returns, Wrap Technologies is expected to underperform. The beta indicator is a useful tool for investors as it provides insight into whether Wrap Technologies' performance aligns with the broader market, and it also measures the stock's volatility, or risk, relative to the market (i.e., selected benchmark). In simpler terms, if Wrap's performance doesn't deviate significantly from the market, it doesn't contribute much risk to the portfolio, but it also doesn't significantly enhance the expected returns.

Main Points

Wrap Technologies (NASDAQ: WRAP), a key player in the Scientific & Technical Instruments industry, presents a compelling investment opportunity this December. The company's Total Risk Alpha of 1.66 suggests a potential for higher returns, while a Sortino Ratio of 0.2463 indicates a favorable risk-adjusted performance. Despite a Maximum Drawdown of 37.11, the stock has shown a significant Price Percent Change of 33.19, pointing towards a strong upward trend. Moreover, with a Beta of 1.832, Wrap Technologies' stock price is expected to move more than the market, providing an opportunity for greater profits. However, investors should also consider the Downside Variance of 18.46, which could indicate potential losses.
Published over three months ago
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Reviewed by Ellen Johnson

In the world of investing, fortune often favors the bold. Wrap Technologies (NASDAQ: WRAP), a key player in the Electronic Equipment & Instruments sector, presents a compelling case for robust growth in December. With a market valuation of 3.01 and a hype value of 3.03, the company's stock is poised for a significant uptick. Despite the analyst overall consensus being a 'Hold', the Wall Street target price stands at 2.5, indicating a potential upside. The company's shares short have increased from 2.9M to 3.1M over the last month, suggesting a growing interest among investors. The stock's 52-week high and low stand at 3.2 and 0.95 respectively, with the 200-day MA and 50-day MA at 1.6494 and 1.6226, indicating a positive trend. Given these factors, Wrap Technologies presents a lucrative investment opportunity for those willing to take calculated risks. Currently, Wrap Technologies' Revenue to Assets ratio remains relatively stable compared to the previous year. As of November 4, 2023, the Quick Ratio is projected to increase to 10.62, while Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) are expected to decrease to -$18.1 million. The purpose of this article is to provide retail investors with our perspective on the future value of Wrap Technologies. We will explore the reasons why this could be a game-changer for the company's retail investors.
There are currently many different techniques concerning forecasting the market as a whole as well as predicting future values of individual securities such as Wrap Technologies. Regardless of method or technology, to accurately forecast the stock or bond market is more a matter of luck rather than a particular technique. Nevertheless, trying to predict the stock market accurately is still an essential part of the overall investment decision process. Using different forecasting techniques and comparing the results might improve your chances of accuracy even though unexpected events may often change the market sentiment and impact your forecasting results.

Predictive Modules for Wrap Technologies

Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Wrap Technologies' 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 use the tools below to analyze the current value of Wrap Technologies in the context of predictive analytics.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Wrap Technologies. Your research has to be compared to or analyzed against Wrap Technologies' peers to derive any actionable benefits. When done correctly, Wrap Technologies' 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 Wrap Technologies.

How important is Wrap Technologies's Liquidity

Wrap Technologies financial leverage refers to using borrowed capital as a funding source to finance Wrap Technologies ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Wrap Technologies 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 Wrap Technologies' 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 Wrap Technologies' 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 Wrap Technologies's total debt and its cash.

Wrap Technologies Gross Profit

Wrap Technologies Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Wrap Technologies 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 Wrap Technologies Gross Profit growth over the last 10 years. Please check Wrap Technologies' gross profit and other fundamental indicators for more details.

Breaking down Wrap Technologies Indicators

Wrap Technologies is displaying above-average volatility over the selected time horizon. Investors should scrutinize Wrap Technologies independently to ensure intended market timing strategies are aligned with expectations about Wrap Technologies volatility. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Wrap Technologies' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Wrap Technologies' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Shares Breakdown

As Warren Buffet wisely said, be fearful when others are greedy and be greedy when others are fearful.
This sentiment rings true for Wrap Technologies (NASDAQ: WRAP), a company that has shown robust growth potential. With a Wall Street target price of $2.5, the stock is currently trading below its 50-day moving average of $1.62 and 200-day moving average of $1.65, indicating a lucrative investment opportunity. The company's strong financial position is evident from its cash and equivalents of $28.5 million and working capital of $23.7 million. Furthermore, the company has a low debt-to-equity ratio of 0.01%, indicating minimal financial risk. However, potential investors should be mindful of the company's high short ratio of 32.16X and the probability of bankruptcy at 49.17%. Despite these risks, the potential upside of 15.45 and a beta of 1.83 suggest that Wrap Technologies could offer substantial returns for risk-tolerant investors. .

Will Wrap Technologies growth be reliable after the spike?

The latest skewness of Wrap Technologies, exceeding 2.23, signifies a substantial positive skew in the distribution of its returns. This implies that the company's stock has a greater likelihood of significant gains, potentially a positive indicator for investors seeking growth opportunities. However, the sustainability of this growth following the recent surge is not assured. Investors are advised to exercise caution and take into account the company's overall financial health, market conditions, and other risk factors before making investment decisions. Wrap Technologies is exhibiting above-average volatility over the chosen time period. Investors should thoroughly analyze Wrap Technologies independently to ensure that their intended market timing strategies align with their expectations about the company's volatility. Understanding varying market volatility trends often assists investors in timing the market. The correct use of volatility indicators allows traders to gauge the risk of Wrap Technologies' stock against market volatility during both bullish and bearish trends. The increased level of volatility that accompanies bear markets can directly affect Wrap Technologies' stock price, adding stress for investors as they watch the value of their shares decline. This typically compels investors to rebalance their portfolios by purchasing different stocks as prices drop.

Our Final Take On Wrap Technologies

While other entities within the scientific & technical instruments industry are still a little expensive, even after the recent corrections, Wrap Technologies may offer a potential longer-term growth to retail investors. With an impartial outlook on the current market volatility, it may be better to hold off any inventment activity and neither take up nor exit any shares of Wrap Technologies at this time. The Wrap Technologies risk-reward trade off is not appealing enough to do any trading. 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 Wrap Technologies.

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Editorial Staff

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 Vlad Skutelnik do not own shares of Wrap Technologies. Please refer to our Terms of Use for any information regarding our disclosure principles.

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