Ocean Power Technologies currently has 857K in liabilities, with a Debt to Equity (D/E) ratio of 0.01. This may indicate that the company is not sufficiently leveraging borrowing. The company's current ratio stands at 16.45, suggesting that it has adequate liquidity to meet its financial obligations as they come due.
Debt can be a useful tool for Ocean Power Technologies until it encounters difficulties in paying it off, either through new capital or free cash flow. If the company fails to meet its legal obligations to repay debt, shareholders could potentially lose their entire investment. However, a more common scenario is when companies like Ocean Power Technologies issue additional shares at discounted prices, diluting the value for existing shareholders. In such instances, debt can be a superior tool for Ocean Power to invest in growth at high rates of return.
When considering Ocean Power's use of debt, it should always be evaluated in conjunction with cash and equity. We provide trading recommendations that align with the recent expert consensus on Ocean Power Technologies. Our dynamic recommendation engine uses a multidimensional algorithm to analyze the company's growth potential based on all available technical and fundamental data.
Continued study
Despite the overall market uptick, Ocean Power Technologies' stock has modestly reset by 1%. The company's valuation metrics suggest a mixed bag for investors. With a market capitalization of
36.35M, the company's shares are trading at a high price-to-sales ratio of
13.97X, indicating that the stock may be overvalued. However, the company's book value per share stands at 0.98X, which is relatively low and could be seen as a buying opportunity. The company's fiscal year-end financials reported a significant loss of
20.7M before tax, which is a red flag for potential investors. Furthermore, the company's short ratio of 21.22 indicates that a considerable number of investors are betting against the stock.
We determine the current worth of Ocean Power Technologies using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Ocean Power Technologies based exclusively on its
fundamental and basic
technical indicators. By analyzing Ocean Power's
financials, quarterly and monthly indicators, and related drivers such as
dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of
Ocean Power's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Ocean Power. We calculate exposure to Ocean Power's
market risk, different
technical and
fundamental indicators, relevant financial multiples and ratios, and then
comparing them to Ocean Power's related companies.
Watch out for price decline
Please consider monitoring Ocean Power on a daily basis if you are holding a position in it. Ocean Power is trading at a penny-stock level, and the possibility of delisting is much higher compared to other stocks. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion.
Most exchanges require public instruments, such as Ocean Power stock to be traded above the $1 level to remain listed. If Ocean Power stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.
Ocean Power Technologies Investment Alerts
Ocean investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Ocean Power Technologies performance across your portfolios.Please check all
investment alerts for Ocean
Ocean Power Valuation Ratios as Compared to Competition
Our valuation model uses many indicators to compare Ocean value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Ocean Power competition to find
correlations between indicators driving the intrinsic value of Ocean.
Ocean Power Gross Profit
Ocean Power Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Ocean Power 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 Ocean Power Gross Profit growth over the last 10 years. Please check Ocean Power's
gross profit and other
fundamental indicators for more details.
Detailed Perspective On Ocean Power
The newest gain in Ocean Power short term price appreciation may encourage private investors to take a closer look at the company as it is trading at a share price of
0.61 on
86,861 in trading volume. The company executives have successfully maneuvered the company at convenient times to take advantage of all market conditions in
June. The stock standard deviation of daily returns for 90 days investing horizon is currently 3.55. The above-average risk is mostly attributed to
market volatility and speculations regarding some of the upcoming earning calls from Ocean Power partners.
| 2020 | 2021 | 2022 | 2023 (projected) |
Revenues USD | 1.21 M | 1.76 M | 1.58 M | 1.53 M | Revenues | 1.21 M | 1.76 M | 1.58 M | 1.53 M |
Margins Breakdown
Ocean profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Ocean Power itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Ocean Power profit margins.
| EBITDA Margin | (11.21) |
| Gross Margin | (0.0554) |
| Profit Margin | (10.42) |
Ocean Power Earnings before Tax is comparatively stable at the moment. Also, Ocean Power Average Assets is comparatively stable at the moment. Ocean Power Technologies (OPT), a domestic electrical equipment company, recently saw a modest 1% reset in its stock, despite a general market uptick. With a market capitalization of
$36.35M, the company's valuation remains steady, reflecting its solid net working capital of $56.3M. The company's total current assets stand at
$59.3M, with cash and equivalents amounting to $51.9M.
Despite these positive figures, OPT's
financial performance shows an EBIT of a loss of $21.6M and a negative operating margin of 9.98, indicating significant operational challenges. The company's total revenue for the period was $1.8M, with a cost of revenue at $1.9M, resulting in a gross loss of $101K. The total operating expenses were $21.5M, leading to a free cash flow of a loss of $21.4M. The company's diluted EPS stands at a loss of $0.4, reflecting its negative profitability. In terms of its balance sheet, OPT has total assets of $73.4M, including $14.1M in non-current assets and $9.76M in current assets. Its total stockholder equity is $68.8M, with a price to book ratio of 0.52X. The company's total debt is $857K, with short term debt at $319K, and net debt at a negative $7M, indicating a strong liquidity position. Investor sentiment towards OPT is mixed, with 7.681% of the stock held by institutions and 0.14% owned by insiders. The number of shares shorted stands at 3.98M, indicating a short percent of 0.0509. Despite the challenges, the company's potential upside is 7.14, indicating some optimism for
future performance. .
Will Ocean drop impact its fundamentals?
The latest kurtosis reading of 1.27 for Ocean Power Technologies suggests a relatively moderate distribution of returns, indicating a lesser likelihood of extreme price fluctuations. While this might appear to signal stability, investors should maintain a level of caution. The company's
fundamentals could still be affected by a potential drop in its stock price. This could be influenced by factors such as shifts in market sentiment, changes in operational performance, or fluctuations in the broader economic landscape. Therefore, despite the moderate kurtosis, investors should closely monitor the company's
financial health and market conditions. Ocean Power Technologies demonstrates above-average downside volatility for the selected time horizon. We advise investors to further inspect Ocean Power Technologies and ensure that all
market timing and asset allocation strategies align with the estimation of Ocean Power's future alpha. Ocean Power Technologies is potentially a penny stock. While Ocean Power may indeed be a worthwhile investment, many penny stocks are speculative and subject to artificial price inflation. We urge investors to fully understand the upside potential and downside risk of investing in Ocean Power Technologies. Investors should be on the lookout for signals such as email spam, message board hype, claims of breakthroughs, sudden increases in volume, unexpected news releases, unreported promotions, or demotions released before SEC filings.
We also recommend checking the biographies and work histories of current and past company officers before investing in high volatility instruments, penny stocks, or equities with a microcap classification. While it is possible to profit from an investment in Ocean Power if your entry and exit are perfectly timed, remember that penny stocks that have been artificially hyped typically cannot maintain their increased share price for more than a few days. The price of a promoted high volatility instrument will almost always revert back. The only way to increase shareholder value is through legitimate performance backed by solid fundamentals. In conclusion, despite the overall market gain, Ocean Power Technologies' stock has only reset by 1 percent. With the fiscal year ending in April, the company has a naive expected forecast value of
0.62 and a valuation real value of
0.59. The valuation market value stands at 0.61, slightly above the valuation hype value of 0.6. Analysts have a consensus of 'Hold' on the stock, with only one analyst recommending a 'Hold'. The possible upside price is a substantial 4.18, but investors should also be aware of the possible downside price of 0.0061. Therefore, while there may be potential for growth, investors should exercise caution and closely monitor the stock's performance. .
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Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, predictive investment analytics, and risk management.
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 Vlad Skutelnik do not own shares of Ocean Power Technologies. Please refer to our
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