Will T2 Biosystms (USA Stocks:TTOO) recent volatility force insiders to sell?
 | By Raphi Shpitalnik | Macroaxis Story |
T2 Biosystems currently holds approximately $13.21 million in cash, with a positive cash flow from operations of $50.63 million. This results in a cash-per-share (CPS) ratio of 1.87, which could potentially make it an attractive takeover target, assuming it continues to generate positive cash flow. T2 Biosystems has a performance score of 15 on a scale of zero to a hundred. The company has a Beta (Systematic Risk) of -4.0312, indicating a somewhat significant risk relative to the market. As market returns increase, returns on owning T2 Biosystems are expected to decrease by larger amounts. Conversely, during market turmoil, T2 Biosystems is expected to outperform the market.
While it's important to pay attention to T2 Biosystems' existing price patterns, it's also crucial to be realistic about what can be achieved with equity price patterns. Our approach to measuring the future potential of any stock involves looking not only at its past charts but also at the business as a whole, including all available fundamental and technical indicators.
To evaluate if T2 Biosystems' expected return of 3.26 will be sustainable in the future, we have identified twenty-one different technical indicators, which can help you to verify if the expected returns are sustainable. Use T2 Biosystems' standard deviation, as well as the relationship between the value at risk and kurtosis, to analyze future returns on T2 Biosystems.
Additional evaluation
T2 Biosystems (TTOO) has recently experienced significant volatility, which may present unique trading opportunities for investors. The company's stock has seen a price change of $0.02, representing a 7.69% percent change. This volatility is reflected in the company's high downside variance of 164.13 and variance of 279.94, indicating a substantial risk for potential investors. However, the company's Jensen Alpha of 3.58 and Sortino Ratio of 0.276 suggest that the stock's returns have outperformed the market when adjusting for this risk. Despite the high volatility, the company's Information Ratio of 0.2114 indicates that the stock's returns have been consistent relative to the amount of risk taken. Therefore, while T2 Biosystems' recent volatility may present potential risks, it may also offer unique trading opportunities for investors willing to accept these risks.Macroaxis uses a strict editorial review process to publish stories and blog posts. Our publishers support our company and may receive a small commission when the partner links or references are utilized. Commissions do not affect the opinions or evaluations of our editorial team. The information our editors and media partners deliver is confidential and licensed for your sole use as a Macroaxis user. We reserve all rights to the content of this article, and therefore copying or distributing this story in whole or in part is strictly prohibited.
Reviewed by Michael Smolkin
T2 Biosystems, Inc. (TTOO), a leading player in the Diagnostics & Research industry, has recently been subject to significant market volatility. The company, known for its innovative diagnostic products and product candidates, has a market value of approximately $0.28 billion. The recent fluctuations in the stock price may provide an opportunity for insider trading, especially considering the analyst overall consensus which currently stands at 'Hold'. Analysts have provided a range of target prices, with the highest estimated target price at $2.5 and the lowest at $0.07. The average estimated target price is $1.285, based on two estimates. Despite the recent volatility, the company's valuation hype value stands at $0.22, slightly below its real value of $0.52. As the fiscal year end approaches in December, it will be interesting to see how the market responds to T2 Biosystems' performance. Considering an investment horizon of 60 days, T2 Biosystems is projected to generate a return on investment that is 30.18 times higher than the market average. However, it's important to note that the company is 30.18 times more volatile than its market benchmark. It trades approximately 0.19 of its potential returns per unit of risk, compared to the Dow Jones Industrial Average, which currently generates about 0.05 per unit of risk. Given the indifference of many conservative investors towards recent market risk, we believe it's prudent to review T2 Biosystems' current volatility. We will explore the potential for T2 Biosystems' current volatility to persist through October.Volatility is a rate at which the price of T2 Biosystms 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 T2 Biosystms may increase or decrease. In other words, similar to TTOO's beta indicator, it measures the risk of T2 Biosystms and helps estimate the fluctuations that may happen in a short period of time. So if prices of T2 Biosystms 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.
Watch out for price decline
Please consider monitoring T2 Biosystms on a daily basis if you are holding a position in it. T2 Biosystms 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 T2 Biosystms stock to be traded above the $1 level to remain listed. If T2 Biosystms 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 T2 Biosystms's Liquidity
T2 Biosystms financial leverage refers to using borrowed capital as a funding source to finance T2 Biosystms ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. T2 Biosystms 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 T2 Biosystms' 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 T2 Biosystms' 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 T2 Biosystms's total debt and its cash.
T2 Biosystms Gross Profit
T2 Biosystms Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing T2 Biosystms 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 T2 Biosystms Gross Profit growth over the last 10 years. Please check T2 Biosystms' gross profit and other fundamental indicators for more details.
T2 Biosystms Volatility Drivers
T2 Biosystms unsystematic risk is unique to T2 Biosystms 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 T2 Biosystms you can also buy Genetic Technologies. You can also mitigate this risk by investing in the health care 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 T2 Biosystms 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 T2 Biosystms income statement and balance sheet. Here are more details about TTOO volatility.Click cells to compare fundamentals
A Deeper look at TTOO
The recent price roll up of T2 Biosystms created some momentum for insiders as it was traded today as low as 0.23 and as high as 0.3 per share. The company directors and management may have good odds in positioning the entity resources to exploit market volatility in October. The stock standard deviation of daily returns for 90 days investing horizon is currently 16.8. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the T2 Biosystms partners. T2 Biosystems, Inc. (NASDAQ: TTOO), an in vitro diagnostics company, has recently seen significant volatility in its stock price. With a coefficient of variation at a high 470.52, downside deviation at 12.81, and a maximum drawdown of 78.57, it's clear that the stock's performance has been far from stable. This volatility, combined with a Sortino Ratio of 0.276, indicates that the stock's returns are not compensating for the risk taken by investors. The company's financial health also raises concerns.Despite a total asset of $34.39M and working capital of $9.23M, T2 Biosystems has a high debt to equity ratio of 6.64% and total debt of $59.22M. Moreover, its current liabilities stand at $18.54M, with a probability of bankruptcy at a worrying 95.73%. However, the stock's volatility could present insider trading opportunities. Currently, 0.74% of the shares are owned by insiders, with 19.47% owned by institutions. The stock's beta is relatively low at 0.27, suggesting it is less volatile than the market as a whole. The target price for the stock is $0.15, indicating potential upside. In conclusion, while T2 Biosystems' financial health and recent volatility may raise red flags for some investors, it could also provide opportunities for those looking to capitalize on price fluctuations. As always, thorough research and careful consideration of risk is advised before making any investment decisions. .
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