By examining key indicators for Digimarc and Kontrol, you can assess how market fluctuations impact their stock prices and determine if combining them in a portfolio might reduce risk. Pair trading strategies could involve going long on Kontrol while shorting Digimarc. For further details, explore our [pair correlation](#) module.
Let's dive into asset analysis. The asset utilization ratio measures how much revenue a company generates for every dollar of assets. Digimarc's ratio stands at 43.27%, meaning it earns $0.43 per asset dollar. A higher ratio suggests Digimarc is becoming more efficient in using its assets for daily operations.
Important Points
Digimarc (NASDAQ: DMRC) has recently experienced a slight dip of 3%, presenting a potential buying opportunity for investors who are keen on exploring growth prospects in the Information Technology Services sector. Despite a net income loss of
46M, the company boasts a solid cash reserve of
68.39M, which provides a cushion for future strategic initiatives and operational needs. With insiders holding nearly 30% of the shares, there's a strong indication of confidence from those closest to the company's operations, which could signal promising long-term potential for those considering an entry point at this juncture.
Investment perspective, in general, refers to a viewpoint or opinion regarding investment opportunity in Digimarc. It encompasses the assessment of an investment's potential risks and rewards, and expectations for its
performance over time. Several factors influence the investment perspective on Digimarc, including investment goals, risk tolerance, time horizon, market conditions, and research and analysis. Investors have varying goals, such as capital preservation, income generation, or long-term growth. Risk tolerance plays a significant role in shaping an investor's perspective, with some being more risk-averse and others willing to take on higher risks for potential returns.
How important is Digimarc's Liquidity
Digimarc
financial leverage refers to using borrowed capital as a funding source to finance Digimarc ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Digimarc 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 Digimarc'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 Digimarc'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 Digimarc's total debt and its cash.
Digimarc Gross Profit
Digimarc Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Digimarc 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 Digimarc Gross Profit growth over the last 10 years. Please check Digimarc's
gross profit and other
fundamental indicators for more details.
A Deeper Perspective
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.
Revenue Breakdown
Lets now check Digimarc revenue. Based on the latest financial disclosure, Digimarc reported 34.85
M of revenue.
This is 99.14% lower than that of the Software sector and 99.59% lower than that of the
Information Technology industry. The revenue for all United States stocks is 99.63% higher than that of Digimarc. As for Kontrol Technologies we see revenue of 57.66
M, which is 99.32% lower than that of the Information Technology
| DMRC | 34.85 Million | 0.84 |
| Sector | 4.08 Billion | 97.78 |
| KNRLF | 57.66 Million | 1.38 |
Buy low, sell high is a timeless strategy, and Digimarc's recent 3% dip might just be the opportunity investors are looking for. With a strong current ratio of 7.09, the company demonstrates solid liquidity, suggesting it can comfortably meet its short-term obligations. Despite a net income loss of 46 million, Digimarc's market capitalization stands at 673.89 million, indicating a resilient market presence. The stock's beta of 1.68 suggests higher volatility, which could appeal to those seeking potential gains in a fluctuating market. With a target price of $34, there's a potential upside of 5.46%, making it a stock worth considering for those willing to embrace some risk..
Can Digimarc correct the latest dip?
Digimarc's recent decrease in downside variance to 13.01 suggests a potential reduction in volatility, which might pave the way for a market correction. This stabilization in price movements could attract investors seeking lower-risk opportunities. As volatility diminishes, the trading environment may become more predictable, possibly boosting the stock's performance. However, investors should remain vigilant about broader market trends and company-specific developments that could affect future prices. Despite this recent dip, Digimarc still exhibits above-average downside volatility for the chosen time frame. Understanding these volatility patterns can help investors make informed decisions. In bear markets, heightened volatility can significantly impact Digimarc's stock price, often prompting investors to adjust their portfolios by acquiring different assets as prices decline.
Our Conclusion on Digimarc
Although some companies in the information technology services industry are either recovering or due for a correction, Digimarc may not be as strong as the others in terms of longer-term growth potentials. With a somewhat neutral outlook on your 90 days horizon, it may be better to hold off any trading activity and neither buy new shares of Digimarc nor drop your existing holdings in the Stock. It seems the expected volatility has not yet been fully factored into the current price. 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 Digimarc.
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Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time basis at the beginning of the pandemic and eventually acquired a real taste for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI.
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 Raphi Shpitalnik do not own shares of Digimarc. Please refer to our
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