A Technical Look into the Valuation For GFT Technologies SE (XTRA:GFT)

In taking a look at some key indicators for GFT Technologies SE (XTRA:GFT), we note that the current Book to Market value for the enterprise is at 0.505232. The Book to Market or BTM is determined as Market Value (or Stock Price)/Book Value. Investors Often times look for shares with high Book to Market value as this could indicate that the equity is priced below market value and underpriced.

A ratio of a publicly-traded firm’s book value to its market value. That is, the BTM is a comparison of a firm’s net asset value per share to its stock price. This is a helpful mechanism to aid understand how the market prices a firm relative to its actual worth. A ratio greater than one illustrates an undervalued firm, while a ratio less than one means a firm is overvalued. Value managers seek out companies with high BTMs for their portfolios.

Additional Tools

There are many nonstandard tools to understand whether a firm is profitable or not.  One of the most leading ratios is the “Return on Assets” (aka ROA).  This score illustrates how profitable a firm is relative to its total assets.  The Return on Assets for GFT Technologies SE (XTRA:GFT) is 0.059837.  This number is determined by dividing net income after tax by the firm’s total assets.  A firm that manages their assets well will have a higher return, while a firm that manages their assets poorly will have a lower return.

Looking at some ROIC (Return on Invested Capital) numbers, GFT Technologies SE (XTRA:GFT)’s ROIC is 0.204649. The ROIC 5 year average is 0.321871 and the ROIC Quality ratio is 4.830641. ROIC is a profitability ratio that measures the return that an investment generates for those providing capital. ROIC helps show how efficient a enterprise is at turning capital into profits. 

In terms of EBITDA Yield, GFT Technologies SE (XTRA:GFT) presently has a value of 0.090651. This value is derived by dividing EBITDA by Enterprise Value.

The Current Ratio of GFT Technologies SE (XTRA:GFT) is 1.56. The Current Ratio is used by investors to understand whether a firm can pay short term and long term debts. The current ratio looks at all the liquid and non-liquid assets compared to the firm’s total current liabilities. A high current ratio illustrates that the firm might have trouble managing their working capital. A low current ratio (when the current liabilities are higher than the current assets) illustrates that the firm may have trouble paying their short term obligations.

The Leverage Ratio of GFT Technologies SE (XTRA:GFT) is 0.373239. Leverage ratio is the total debt of a firm 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 calculate how much of a firm’s capital comes from debt. With this ratio, investors can better estimate how well a firm will be able to pay their long and short term financial obligations.

Piotroski F Score

The Piotroski F-Score is a scoring system between 1-9 that determines a enterprise’s financial strength. The score helps understand if a firm’s stock is valuable or not. The Piotroski F-Score of GFT Technologies SE (XTRA:GFT) is 6. A score of nine illustrates a high value stock, while a score of one illustrates a low value stock. The score is determined by the return on assets (ROA), Cash flow return on assets (CFROA), change in return of assets, and quality of earnings. It is also determined by a change in gearing or leverage, liquidity, and change in shares in issue. The score is also calculated by change in gross margin and change in asset turnover.

Checking in on some valuation rankings, GFT Technologies SE (XTRA:GFT) has a Value Composite score of 20. 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 firm with a score closer to 0 would be seen as undervalued, and a score closer to 100 would indicate an overvalued firm. Adding a sixth ratio, shareholder yield, we can view the Value Composite 2 score which is presently sitting at 16.

Volatility/C Score

Stock volatility is a percentage that illustrates whether a stock is a desirable purchase.  Investors look at the Volatility 12m to understand if a firm has a low volatility percentage or not over the stage of a year.  The Volatility 12m of GFT Technologies SE (XTRA:GFT) is 49.121300.  This is determined by taking weekly log normal returns and standard deviation of the stock price over one year annualized.  The lower the number, a firm is thought to have low volatility.  The Volatility 3m is a similar percentage calculated by the daily log normal returns and standard deviation of the stock price over 3 months.  The Volatility 3m of GFT Technologies SE (XTRA:GFT) is 41.704100.  The Volatility 6m is the same, except measured over the stage of six months.  The Volatility 6m is 44.270300.

GFT Technologies SE (XTRA:GFT) presently has a Montier C-score of 4.00000. This indicator was developed by James Montier in an attempt to identify firms that were cooking the books in order to appear better on paper. The score ranges from zero to six where a 0 would indicate no evidence of book cooking, and a 6 would indicate a high likelihood. A C-score of -1 would indicate that there is not enough information available to quantify the score. Montier used six inputs in the calculation. These inputs included a growing difference between net income and cash flow from operations, increasing receivable days, growing day’s sales of inventory, increasing alternate current assets, decrease in depreciation relative to gross property plant and equipment, and high total asset growth.

Here we will take a look at several key ratios for CRA International, Inc. (NasdaqGS:CRAI), starting with the Book to Market (BTM) ratio. Value investors seek stocks with high BTMs for their portfolios.  The ratio is a comparison of the enterprise’s net asset value per share to it’s current price.  This is useful in determining how the market values the firm compared to it’s actual worth.  The Book to Market value of CRA International, Inc. presently stands at 0.541683. 

In terms of EBITDA Yield, CRA International, Inc. (NasdaqGS:CRAI) presently has a value of 0.082359. This value is derived by dividing EBITDA by Enterprise Value.

CRA International, Inc. (NasdaqGS:CRAI) at present has a current ratio of 1.37. The current ratio, also known as the working capital ratio, is a liquidity ratio that displays the proportion of current assets of a business relative to the current liabilities. The ratio is simply determined by dividing current liabilities by current assets. The ratio may be used to provide an idea of the ability of a certain firm to pay back its liabilities with assets. Typically, the higher the current ratio the better, as the firm may be more capable of paying back its obligations.

The Price to book ratio is the current stock price of a firm divided by the book value per share.  The Price to Book ratio for CRA International, Inc. NasdaqGS:CRAI is 1.846099.  A lower price to book ratio illustrates that the stock might be undervalued.  Similarly, Price to cash flow ratio is another useful ratio in determining a firm’s value.  The Price to Cash Flow for CRA International, Inc. (NasdaqGS:CRAI) is 12.476737.  This ratio is determined by dividing the market value of a firm by cash from operating activities.  Additionally, the price to earnings ratio is another leading way for analysts and investors to understand a firm’s profitability.  The price to earnings ratio for CRA International, Inc. (NasdaqGS:CRAI) is 27.781948. This ratio is found by taking the current stock price and dividing by EPS.

Looking at some ROIC (Return on Invested Capital) numbers, CRA International, Inc. (NasdaqGS:CRAI)’s ROIC is 0.151613. The ROIC 5 year average is 0.131164 and the ROIC Quality ratio is 5.757712. ROIC is a profitability ratio that measures the return that an investment generates for those providing capital. ROIC helps show how efficient a enterprise is at turning capital into profits. 

Free Cash Flow Growth (FCF Growth) is the free cash flow of the current year minus the free cash flow from the previous year, divided by last year’s free cash flow.  The FCF Growth of CRA International, Inc. (NasdaqGS:CRAI) is -0.506116.  Free cash flow (FCF) is the cash produced by the firm minus capital expenditure.  This cash is what a firm uses to meet its financial obligations, such as making payments on debt or to pay out dividends.  The Free Cash Flow Score (FCF Score) is a useful mechanism in calculating the free cash flow growth with free cash flow stability – this gives investors the overall quality of the free cash flow.  The FCF Score of CRA International, Inc. (NasdaqGS:CRAI) is 0.204962.  Experts say the higher the value, the better, as it means that the free cash flow is high, or the variability of free cash flow is low or both.

The Gross Margin Score is determined by considering at the Gross Margin and the overall stability of the firm over the stage 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 CRA International, Inc. (NasdaqGS:CRAI) is 8.00000.  The more stable the firm, the lower the score.  If a firm is less stable over the stage of time, they will have a higher score.

At the time of writing, CRA International, Inc. (NasdaqGS:CRAI) has a Piotroski F-Score of 7. The F-Score may aid uncover companies with strengthening balance sheets. The score may also be used to uncover the weak performers. Joseph Piotroski developed the F-Score which employs nine nonstandard variables based on the firm financial statement. A single point is assigned to each test that a stock passes. Typically, a stock scoring an 8 or 9 would be seen as strong. On the alternate end, a stock with a score from 0-2 would be viewed as weak.

Shifting gears, we can see that CRA International, Inc. (NasdaqGS:CRAI) has a Q.i. Value of 35.00000. The Q.i. Value ranks companies using four ratios. These ratios consist of EBITDA Yield, FCF Yield, Liquidity, and Earnings Yield. The purpose of the Q.i. Value is to aid identify companies that are the most undervalued. Typically, the lower the value, the more undervalued the firm tends to be.

Watching some historical volatility numbers on shares of CRA International, Inc. (NasdaqGS:CRAI), we can see that the 12 month volatility is at present 25.257600. The 6 month volatility is 28.772000, and the 3 month is spotted at 35.974100. Following volatility data can aid calculate how much the share price has fluctuated over the specified time duration. Although past volatility action may aid project future stock volatility, it may also be vastly nonstandard when taking into account alternate factors that may be driving price action during the measured time duration. 

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