Are you still shorting Equity?
 | By Ellen Johnson | Macroaxis Story |
The market is a pendulum that forever swings between unsustainable optimism and unjustified pessimism. Equity Lifestyle Properties, a key player in the REIT - Residential industry, has been experiencing significant volatility, prompting investors to reconsider their positions.
With a market value of $60.71, the stock is currently trading close to its median price of $60.96. The company's valuation real value stands at $67.41, suggesting potential upside. However, the accumulation distribution of 25.2K and a daily balance of power at 0.1915 indicates a level of uncertainty among investors.
Analysts have a consensus of 'Buy' on the stock, with three strong buys and nine holds. The estimated target price ranges from a low of $65.71 to a high of $80.15, with an average target price of $72.21. This suggests a potential upside from the current trading levels.
However, the stock's price action indicator stands at -0.16, and the possible downside price is $59.05, indicating potential risks. Investors need to weigh these factors against the company's expected EPS of $1.85 for the next fiscal year ending in December.
In conclusion, while Equity Lifestyle Properties stock presents potential for growth, the volatility and potential downside risk cannot be ignored. Investors should closely monitor the stock and consider their risk tolerance before making a decision. Given a 90-day investment horizon, Equity Lifestyle Properties is projected to underperform the market. The company's volatility is 1.73 times higher than its market benchmark, trading about -0.15 of its total potential returns per unit of risk. Currently, the Dow Jones Industrial is generating approximately 0.02 per unit of volatility. As many traditional traders are steering clear of diversified REITs, it's worth taking a closer look at Equity Lifestyle Properties to understand its current volatility patterns. We will assess whether the recent price volatility of Equity Lifestyle suggests a potential bounce in May.
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Reviewed by Vlad Skutelnik
Equity Lifestyle Properties holds approximately 27.78 million in cash, with a positive cash flow from operations of 548 million. This results in a cash-per-share (CPS) ratio of 0.15.
Main Takeaways
Given the negative Total Risk Alpha of -0.13 and a Jensen Alpha of -0.12, Equity Lifestyle Properties stock exhibits a higher volatility, which may not be suitable for risk-averse investors. However, with a Potential Upside of 1.51, those willing to tolerate the risk could see significant returns.Volatility is a rate at which the price of Equity Lifestyle or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Equity Lifestyle may increase or decrease. In other words, similar to Equity's beta indicator, it measures the risk of Equity Lifestyle and helps estimate the fluctuations that may happen in a short period of time. So if prices of Equity Lifestyle fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility. Please read more on our technical analysis page.
How important is Equity Lifestyle's Liquidity
Equity Lifestyle financial leverage refers to using borrowed capital as a funding source to finance Equity Lifestyle Properties ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Equity Lifestyle 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 Equity Lifestyle'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 Equity Lifestyle'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 Equity Lifestyle's total debt and its cash.
Equity Lifestyle Gross Profit
Equity Lifestyle Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Equity Lifestyle 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 Equity Lifestyle Gross Profit growth over the last 10 years. Please check Equity Lifestyle's gross profit and other fundamental indicators for more details.
Equity Lifestyle Volatility Drivers
Equity Lifestyle unsystematic risk is unique to Equity Lifestyle Pro and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Equity Lifestyle you can also buy UDR Inc. You can also mitigate this risk by investing in the real estate sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Equity Lifestyle important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Equity Lifestyle income statement and balance sheet. Here are more details about Equity volatility.Click cells to compare fundamentals
An Additional Perspective On Equity Lifestyle Pro
Equity Lifestyle Pro price drop over the last few months could raise concerns from private investors as the firm is trading at a share price of 60.71 on 1,645,774 in volume. The company directors and management were not very successful in positioning the firm resources to exploit market volatility in March. However, diversifying your holdings with Equity Lifestyle Properties or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 1.05. The below-average Stock volatility is a good sign for longer-term investment options and for buy-and-hold investors.Every cloud has a silver lining, and the same could be said for Equity Lifestyle Properties stock. Despite a negative Information Ratio of -0.12 and a Skewness of -0.09, indicating a potential for risk, the company boasts a healthy Net Income of $314.21 million and a Five Year Return of 2.03%. However, the stock's Standard Deviation of 1.06 and a Probability of Bankruptcy at 33.57% suggest a high level of volatility. With a Market Capitalization of $11.84 billion and a Current Valuation of $14.79 billion, investors may want to reconsider their position, keeping in mind the company's potential upside of 1.51. In the end, the decision to hold, sell, or buy more of Equity Lifestyle Properties stock will depend on an investor's risk tolerance and investment strategy..
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