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Does FREYR Battery (USA Stocks:FREY) have strong technical and fundamental indicators based on the current rise?

November 9, 2024  By Gabriel Shpitalnik
Macroaxis Story
When it comes to investing, numbers often tell the story. FREYR Battery's financial health paints a picture of a company with potential. With a robust current ratio of 11.74x, FREYR demonstrates a strong ability to cover its short-term liabilities, which total $97.5M, with its current assets of $312M. Despite a retained earnings loss of $275M, the company's low debt-to-equity ratio of 0.03% suggests a conservative approach to leveraging debt. The enterprise value stands at $50.5M, indicating a potentially undervalued position when compared to its market valuation. While the EBITDA shows a loss of $133.2M, the company's substantial property, plant, and equipment net worth of $390.8M underscores its commitment to growth and expansion in the machinery sector. With insiders holding 24.11% of shares, there's a significant vested interest in the company's future success. Despite some lackluster technical and fundamental signals, FREYR Battery might be nearing a pivotal turning point that could boost its stock in December 2024. The company's bankruptcy risk is below 20%, which is relatively low. The question remains: will investors continue to show interest in FREYR Battery as December approaches?
Published over two weeks ago
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Reviewed by Vlad Skutelnik

Considering FREYR Battery's robust financial position, with total assets of 732.18M and a low debt-to-equity ratio of 0.03%, the company appears well-positioned to capitalize on growth opportunities. However, potential investors should be cautious of the company's free cash flow loss of 275.8M, which may impact its ability to fund future expansions without additional financing.

Main Points

Investing in FREYR Battery SA over a three-month period carries significant risk. The company's Sharpe Ratio stands at 0.13, indicating a return of 0.13% per unit of volatility during this time. We've examined 28 technical indicators to help assess whether the anticipated 1.34% returns are worth the associated risk. To better understand the company's unique risks that can't be diversified, consider its downside deviation of 5.38 and mean deviation of 5.26. These metrics provide insight into the potential volatility and risk specific to FREYR Battery.
Typically, a company's financial statements are the reports that show the financial position of the company. There are three main documents that fall into the category of financial statements. These documents include FREYR Battery income statement, its balance sheet, and the statement of cash flows. Potential FREYR Battery investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although FREYR Battery investors may use each financial statement separately, they are all related. The changes in FREYR Battery's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on FREYR Battery's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
The goal of FREYR Battery fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of FREYR Battery performance into the future periods or doing a reasonable stock valuation. The intrinsic value of FREYR Battery shares is the value that is considered the true value of the share. If the intrinsic value of FREYR is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares FREYR Battery. Please read more on our fundamental analysis page.

How effective is FREYR Battery in utilizing its assets?

FREYR Battery SA reports assets on its Balance Sheet. It represents the amount of FREYR resources that either has an existing economic value or will provide some form of benefits in the future. By effectively utilizing its assets, FREYR Battery aims to generate revenue, control costs, drive operational efficiency, and enhance profitability. Optimizing asset utilization helps maximize shareholder value and maintain a competitive position in the Industrial Machinery & Supplies & Components space. To get a better handle on how balance sheet or income statements item affect FREYR volatility, please check the breakdown of all its fundamentals.

Are FREYR Battery Earnings Expected to grow?

The future earnings power of FREYR Battery involves the interaction of many company-specific, industry, and economic forces. Earnings estimates embody investors' opinions of FREYR Battery factors such as sales growth, product demand, competitive industry environment, profit margins, and cost controls. FREYR Battery stock prices adjust as these expectations change or are proven wrong. The main thing to remember is that equities with high expected earnings growth tend to underperform the market because it is usually difficult to meet the market's high expectations. Companies with low earnings expectations tend to do better than expected. Please use our latest analysis of FREYR expected earnings.

FREYR Battery Gross Profit

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

What is driving FREYR Battery Investor Appetite?

Although in the United States, the Securities and Exchange Commission has enforced strong rules to prevent insiders from engaging in insider trading, finding insiders among active shareholders of FREYR Battery is not uncomon. There are few distinct groups of FREYR Battery stakehholders that the SEC considers insiders. Investors usually gain information through their work as corporate directors, officers, or employees. If these individuals share the information with a friend, family, or business partner and the person who receives the information exchanges stock in the company, he or shie is also an insider. Let's take a look at how the ownership of FREYR is distributed among investors.

Ownership Allocation

FREYR Battery holds a total of 139.7 Million outstanding shares. FREYR Battery SA retains substantial amount of outstanding shares owned by insiders. An insider is usually defined as a CEO, other corporate executive, director, or institutional investor who own at least 10% of the company's outstanding shares. Please note that no matter how many assets the company secures, if the real value of the firm is less than the current market value, you may not be able to make money on it.
Retail Investors
40.98%		Insiders
24.12%		Institutions
34.91%
Retail Investors40.98
Insiders24.11
Institutions34.91
Please be aware that individual investors typically purchase shares for their personal accounts and usually in smaller quantities compared to institutional investors. While they might influence FREYR Battery's decisions if they own a significant combined portion of its shares, such influence is relatively rare. Conversely, institutional investors - like mutual funds, pension funds, hedge funds, and other investment companies - often have a substantial sway over FREYR Battery's decisions due to their larger holdings.

Asset Utilization

One of the ways to look at asset utilization of FREYR is to check how much profit was generated for every dollar of assets it reports. FREYR Battery SA shows a negative utilization of assets of -0.12 percent, losing $0.001179 for each dollar of assets held by the firm. Inefficient asset utilization denotes the company is being less capable with each dollar of assets it shows. Put another way, asset utilization of FREYR Battery SA shows how inadequate it operates for each dollar spent on its assets.
Net Tangible Assets
862.7 M
Total Current Assets
328.3 M
Net Tangible Assets862.75 Million59.54
Non Current Assets Total220.14 Million15.19
Non Currrent Assets Other1.4 Million0.0965
Other Assets0.950.0
Other Current Assets34.18 Million2.36
Total Current Assets328.34 Million22.66
Intangible Assets2.31 Million0.16
As Warren Buffett famously noted, "Price is what you pay. Value is what you get." FREYR Battery (NYSE: FREY) seems to embody this sentiment as it navigates the challenging waters of the electrical equipment and parts industry. With a market capitalization of $328.31 million and a price-to-book ratio of 0.52, the stock appears undervalued relative to its book value, suggesting potential for appreciation. Despite reporting losses with an operating income of 143 million and a net income from continuing operations of 23.3 million, the company maintains a robust financial position with cash and short-term investments totaling $277.2 million, significantly outweighing its total debt of $18.82 million. The firm's beta of 0.73 indicates lower volatility compared to the broader market, which might appeal to risk-averse investors looking for growth opportunities in the burgeoning battery sector.

FREYR Battery current price slide can leaving investors with little time to react

FREYR Battery's recent price drop has surprised many investors, especially since the stock's standard deviation has narrowed to 10.35. This lower volatility might imply some stability, but it also means any sudden price changes could catch investors off guard. As the market adjusts, those holding FREYR Battery shares should remain alert, as the stock's path could shift quickly. The company is experiencing higher-than-average volatility, which can help investors decide when to buy or sell. By using volatility indicators, traders can assess FREYR Battery's risk compared to the broader market during both rising and falling trends.
Increased volatility in bear markets can significantly affect the stock price, often prompting investors to adjust their portfolios by exploring other financial options as prices decline.Despite the broader market's upward momentum, FREYR Battery SA's recent dip of over 12% might seem concerning at first glance. However, it's essential to look beyond the immediate price movement. Analysts have a "Hold" consensus on the stock, suggesting a cautious but not overly pessimistic outlook. The highest estimated target price stands at 14.06, indicating potential for recovery and growth. While the current valuation market value is 2.05, the naive expected forecast value of 2.57 suggests room for improvement. Investors should weigh these factors carefully, considering both the potential upside and the inherent risks, before making any decisions..

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Editorial Staff

Gabriel Shpitalnik is a Member of Macroaxis Editorial Board. Gabriel is a young entrepreneur and writes predominantly on the business, technology, and finance sector. He likes to analyze different equity instruments across a wide range of industries focusing primarily on consumer products and evolving technologies. 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 Gabriel Shpitalnik do not own shares of FREYR Battery SA. Please refer to our Terms of Use for any information regarding our disclosure principles.

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