BP Plastics Z Score vs. Return On Equity
| 5100 Stock | 1.20 0.02 1.64% |
For BP Plastics profitability analysis, we use financial ratios and fundamental drivers that measure the ability of BP Plastics to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well BP Plastics Holding utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between BP Plastics's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of BP Plastics Holding over time as well as its relative position and ranking within its peers.
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BP Plastics Holding Return On Equity vs. Z Score Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining BP Plastics's current stock value. Our valuation model uses many indicators to compare BP Plastics value to that of its competitors to determine the firm's financial worth. BP Plastics Holding is rated below average in z score category among its peers. It is rated below average in return on equity category among its peers reporting about 15.67 of Return On Equity per Z Score. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the BP Plastics' earnings, one of the primary drivers of an investment's value.5100 Return On Equity vs. Z Score
Z-Score is a simple linear, multi-factor model that measures the financial health and economic stability of a company. The score is used to predict the probability of a firm going into bankruptcy within next 24 months or two fiscal years from the day stated on the accounting statements used to calculate it. The model uses five fundamental business ratios that are weighted according to algorithm of Professor Edward Altman who developed it in the late 1960s at New York University..
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| = | 1.0 |
To calculate a Z-Score, one would need to know a company's current working capital, its total assets and liabilities, and the amount of its latest earnings as well as earnings before interest and tax. Z-Scores can be used to compare the odds of bankruptcy of companies in a similar line of business or firms operating in the same industry. Companies with Z-Scores above 3.1 are generally considered to be stable and healthy with a low probability of bankruptcy. Scores that fall between 1.8 and 3.1 lie in a so-called 'grey area,' with scores of less than 1 indicating the highest probability of distress. Z Score is a used widely measure by financial auditors, accountants, money managers, loan processors, wealth advisers, and day traders. In the last 25 years, many financial models that utilize z-scores proved it to be successful as a predictor of corporate bankruptcy.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
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| = | 15.67 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
5100 Return On Equity Comparison
BP Plastics is rated below average in return on equity category among its peers.
5100 Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on BP Plastics. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of BP Plastics position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the BP Plastics' important profitability drivers and their relationship over time.
Use BP Plastics in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if BP Plastics position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in BP Plastics will appreciate offsetting losses from the drop in the long position's value.BP Plastics Pair Trading
BP Plastics Holding Pair Trading Analysis
The ability to find closely correlated positions to BP Plastics could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace BP Plastics when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back BP Plastics - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling BP Plastics Holding to buy it.
The correlation of BP Plastics is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as BP Plastics moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if BP Plastics Holding moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for BP Plastics can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your BP Plastics position
In addition to having BP Plastics in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
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ETF themes focus on helping investors to gain exposure to a broad range of assets, diversify, and lower overall costs. The Sovereign ETFs theme has 17 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Sovereign ETFs Theme or any other thematic opportunities.
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Other Information on Investing in 5100 Stock
To fully project BP Plastics' future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of BP Plastics Holding at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include BP Plastics' income statement, its balance sheet, and the statement of cash flows.