Is 374Water (USA Stocks:SCWO) catching up with Arq (USA Stocks:ARQ)?

Despite being in the same Industrials sector, specifically the Pollution & Treatment Controls industry, 374Water (NASDAQ: SCWO) and Arq (ARQ) present different financial outlooks. 374Water, with a net asset of $9.92M and working capital of $7.06M, shows potential for growth. However, its probability of bankruptcy stands at a high 96%, indicating considerable risk. Its financial health is further brought into question with a negative Z Score of -2.42, an operating income loss of $7.1M, and a net income loss of $6.7M. In addition, its return on asset is negative at -0.3, and the company's earnings per share (EPS) estimate for the current year is projected to be a loss of $0.05. On the brighter side, 374Water's revenue stands at $1.7M, with a gross profit of $336.5K and net interest income of $327.1K. Moreover, its shares owned by institutions stand at 12.19%, indicating some level of institutional confidence. Yet, with 4.1M of its 132.67M outstanding shares shorted last month, investor sentiment appears bearish. The high price-to-sales ratio of 113.99X also suggests the stock might be overvalued. In this context, whether 374Water will outperform Arq in the market is uncertain and warrants close monitoring. Arq's share price surged by 8.02% today, significantly outpacing 374Water Common's 1.48% rise. This rapid increase suggests that Arq may be due for a correction sooner than expected. As investor interest in the machinery sector grows, 374Water Common and Arq could be heading in divergent directions. Our focus will be on the competitive dynamics between 374Water and Arq.
Published over six months ago
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Reviewed by Rifka Kats

Despite a challenging operating income of a loss of $7.1M and a net income of a loss of $6.7M, 374Water (USA Stocks: SCWO) may still hold potential for investors. The company's 200 Day Moving Average stands at 1.62, indicating a potential for growth, while its book value of 0.13, coupled with a Price to Book ratio of 10.25X, suggests that the company's assets may be undervalued. In comparison to Arq (USA Stocks: ARQ), 374Water's potential for growth and undervalued assets may position it to outperform in the market.

Primary Points

Analyzing the basic indicators between 374Water Common and Arq allows us to compare the impact of market volatility on both companies' prices. It also helps to assess if combining them in a portfolio can diversify market risk. Pair trading strategies can be utilized, matching a long position in Arq with a short position in 374Water Common. For more information, check out our pair correlation module. Let's examine the assets. The asset utilization indicator shows the revenue earned per dollar of a company's reported assets. 374Water Common has an asset utilization ratio of 16.67 percent, indicating that the company earns $0.17 for each dollar of assets. An increasing asset utilization suggests that 374Water Common Stock is becoming more efficient in using its assets for daily operations.
Investment perspective, in general, refers to a viewpoint or opinion regarding investment opportunity in 374Water Common. 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 374Water Common, 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.

Watch out for price decline

Please consider monitoring 374Water Common on a daily basis if you are holding a position in it. 374Water Common 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 374Water Common stock to be traded above the $1 level to remain listed. If 374Water Common 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.

How important is 374Water Common's Liquidity

374Water Common financial leverage refers to using borrowed capital as a funding source to finance 374Water Common Stock ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. 374Water Common 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 374Water Common'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 374Water Common'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 374Water Common's total debt and its cash.

374Water Common Gross Profit

374Water Common Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing 374Water Common 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 374Water Common Gross Profit growth over the last 10 years. Please check 374Water Common's gross profit and other fundamental indicators for more details.

Another Outlook On 374Water Common

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 take a look at 374Water Common revenue. Based on the latest financial disclosure, 374Water Common Stock reported 1.65 M of revenue. This is 99.95% lower than that of the Machinery sector and 99.29% lower than that of the Industrials industry.
The revenue for all United States stocks is 99.98% higher than that of 374Water Common. As for Arq we see revenue of 99.18 M, which is 57.6% lower than that of the Industrials
Sector
233.9 M
ARQ
99.2 M
SCWO1.65 Million0.49
Sector233.92 Million69.88
ARQ99.18 Million29.63
The proof of the pudding is in the eating, and 374Water (USA Stocks: SCWO) may just be the more delectable dish in the Pollution & Treatment Controls industry. Despite a high probability of bankruptcy at 96.00%, the company's strong insider ownership at 52.35% signals confidence in its future. However, it's worth noting that the company is currently operating at a loss with an operating income of -$7.1M. On the other hand, 374Water's current valuation stands at $166.3M, significantly higher than its net asset value of $9.92M. With a target price of $3, there is a potential upside of 17.24%, suggesting that 374Water may indeed outperform Arq (USA Stocks: ARQ) in the market. .

Will 374Water pull back in April 2024?

The recent semi deviation increase over 6.42 in 374Water Common stock suggests a significant rise in the company's risk-adjusted performance. This volatility may indicate a potential pullback soon. Given the current market dynamics and the company's performance, investors should exercise caution in April 2024. Despite the stock's strong performance, the increased volatility could trigger a correction. Therefore, investors should closely monitor the stock and consider taking profits or setting stop-loss orders to guard against a possible pullback. As of March 16, 2024, 374Water Common has a Coefficient Of Variation of 1151.35, a market risk adjusted performance of 0.2064, and a Standard Deviation of 7.23. The technical analysis model provides tools to check timely technical drivers of 374Water Common Stock and their interrelation. This information can help determine if the entity will mirror its historical prices and volume patterns or if prices will revert.
We can break down nineteen technical drivers for 374Water Common, which can be compared to its sector peers. Please confirm 374Water Common Stock's market risk adjusted performance, variance, and the relationship between the Variance and potential upside to decide if the stock is priced fairly at its current price of 1.37 per share. As 374Water Common Stock is approaching penny stock territory, we recommend closely examining its total risk alpha. In conclusion, 374Water Common Stock has shown a strong advance today, which may be indicative of a potential surge. The analyst overall consensus is a 'Buy' with an estimated target price of $3.00, which is significantly higher than the current valuation market value of $1.37. The highest estimated target price even reaches $3.33, suggesting a possible upside price of $8.91. However, investors should also consider the possible downside price of $0.0137 and the company's negative EPS estimates for both the current and next fiscal year. Therefore, while the stock's recent performance is promising, investors should carefully consider these factors before making a decision. .

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Editorial Staff

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