All that glitters is not gold. Four Seasons Education, a player in the Education & Training Services industry, listed on the NYSE, has been experiencing a surge in its stock price. However, the Valuation Hype Value of 8 is significantly higher than the Valuation Real Value of
7.35, suggesting that the stock might be overhyped. Despite the stock's recent rise, the Analyst Overall Consensus remains a 'Strong Sell', with one analyst issuing a 'Strong Sell' recommendation. This divergence between market hype and
analyst consensus raises questions about the sustainability of the current uptrend. As the company approaches its Fiscal Year End in February, investors should be cautious. The company operates in the Diversified Consumer Services category, a sector known for its volatility. With a Valuation Market Value of
8, it's crucial for investors to distinguish between a genuine growth story and a temporary market hype. In the midst of this unique economic climate, Four Seasons Education may present investors with additional surprises before the next earnings call. We will discuss why we maintain our confidence in the prospect of a recovery. Four Seasons Education is currently trading at $8.00. The stock's price is not significantly influenced by market hype. The average elasticity to hype of its competitors is -0.12. The immediate return on the next news is projected to be quite minimal, while the daily expected return currently stands at -0.31%. The volatility of Four Seasons' price in relation to market hype is approximately 819.88%. The volatility of related hype on Four Seasons is also about 819.88%, with the expected price after the next announcement by competitors being $7.88. Given an investment horizon of 90 days, the next forecasted press release is expected in approximately 9 days.
The successful prediction of Four Seasons
stock price could yield a significant profit to investors. But is it possible? The efficient-market hypothesis suggests that all published
stock prices of traded companies, such as Four Seasons Education, already reflect all publicly available information. This academic statement is a fundamental principle of many financial and investing theories used today. However, the typical investor usually disagrees with a 'textbook' version of this hypothesis and continually tries to find mispriced stocks to increase returns. We use internally-developed statistical techniques to arrive at
the intrinsic value of Four Seasons based on Four Seasons hews, social hype, general headline patterns, and widely used
predictive technical indicators. We also calculate exposure to Four Seasons's
market risk, different
technical and
fundamental indicators, relevant financial multiples and ratios, and then
comparing them to Four Seasons's related companies.
Use Technical Analysis to project Four expected Price
Four Seasons technical stock analysis exercises models and trading practices based on price and volume transformations, such as the moving averages, relative strength index, regressions, price and return correlations, business cycles, stock market cycles, or different charting patterns.
A focus of Four Seasons technical analysis is to determine if market prices reflect all relevant information impacting that market. A technical analyst looks at the history of Four Seasons trading pattern rather than external drivers such as economic, fundamental, or social events. It is believed that price action tends to repeat itself due to investors' collective, patterned behavior. Hence technical analysis focuses on identifiable price trends and conditions.
More Info...Four Seasons Gross Profit
Four Seasons Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Four Seasons 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 Four Seasons Gross Profit growth over the last 10 years. Please check Four Seasons'
gross profit and other
fundamental indicators for more details.
Is Four Seasons valued wisely by the market?
Four Seasons Education reported the previous year's revenue of 34.22
M. Net Loss for the year was (33.49
M) with profit before overhead, payroll, taxes, and interest of 14.29
M.
| 2020 | 2021 | 2022 | 2023 (projected) |
Revenues USD | 43.12 M | 39.72 M | 4.97 M | 10.15 M | Revenues | 280.28 M | 250.22 M | 34.22 M | 67.38 M |
Deferred Revenue Breakdown
Four Seasons Deferred Revenue yearly trend continues to be comparatively stable with very little volatility. Deferred Revenue is likely to outpace its year average in 2023. Deferred Revenue usually refers to a component of Total Liabilities representing the carrying amount of consideration received or receivable on potential earnings that were not recognized as revenue; including sales; license fees; and royalties; but excluding interest income. Where this item is not contained on the company consolidated financial statements and cannot otherwise be imputed the value of 0 is used. At this time, Four Seasons' Deferred Revenue is comparatively stable as compared to the past year.
| 2010 | 84.84 Million |
| 2017 | 90.1 Million |
| 2018 | 87.87 Million |
| 2019 | 71.95 Million |
| 2020 | 75.24 Million |
| 2021 | 6.49 Million |
| 2022 | 7.27 Million |
| 2023 | 23.88 Million |
As Warren Buffet once said, price is what you pay, value is what you get. The Four Seasons Education stock has been on a steady rise, leading investors to wonder if there is further upside on the horizon. The company has a robust net asset value of
601.04M and a market capitalization of
16.95M. Despite a Beta of -0.0086 indicating minimal market correlation, the potential upside of 5.32 suggests promising growth. The company's healthy current ratio of 5.62X and low debt to equity ratio of 0.019% point towards financial stability. However, a probability of bankruptcy at 32.73% and negative return on assets of -0.037 should be factored into investment decisions. The education sector is notoriously resilient, and with Four Seasons Education's position in diversified consumer services, the stock may offer an interesting opportunity for investors seeking sector diversification.
Another 3 percent gain for Four Seasons
Despite the recent 3 percent increase in Four Seasons Education's stock, investors are advised to proceed with caution. The company's most recent Jensen's Alpha, a measure of risk-adjusted performance, is -0.21. This negative figure suggests that the stock has underperformed the market when taking into account inherent risk. Although the short-term gain may appear appealing, the negative Jensen's Alpha indicates that the stock may not yield a satisfactory return on a risk-adjusted basis over the long term. As of October 26th, Four Seasons reports a variance of 9.03, a mean deviation of 1.66, and a standard deviation of 3.01. Technical analysis of Four Seasons Education allows you to use historical prices and volume patterns to identify a pattern that predicts the direction of the company's future prices. In other words, this information can be used to determine whether the company will replicate its model of historical prices and volume momentum, or if the prices will eventually revert. We were able to identify thirteen technical drivers for Four Seasons Education, which can be compared to those of its
competitors. Please verify Four Seasons Education's risk-adjusted performance, variance, as well as the relationship between the variance and potential upside to determine if Four Seasons Education is priced favorably, assuming the market reflects its regular price of $8.0 per share. Given that Four Seasons has an information ratio of -0.06, we recommend you to verify Four Seasons Education's current market performance to ensure the company can sustain itself in the future.
Our Final Take On Four Seasons
Whereas many other companies within the education & training services industry are still a little expensive, even after the recent corrections, Four Seasons may offer a potential longer-term growth to private investors. While some private investors may not share our view, we believe that right now is not a good time to increase your holdings in Four. 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 Four Seasons.
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Ellen Johnson is a Member of Macroaxis Editorial Board. Ellen covers public companies in North America, focusing primarily on valuation and volatility. Six years of experience in predictive investment analytics and risk management.
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