Do you Own More than 0.06590 of Heineken N.V. (ENXTAM:HEIA)?

A recent look at ownership and volatility brings us to a 0.06590 target portfolio weight (as a decimal) for Heineken N.V. (ENXTAM:HEIA) Target weight is the volatility adjusted recommended stock position size for a position in your portfolio.  The maximum target weight is 7% for any given stock.  The indicator is based off of the 100 day volatility reading and calculates a target weight accordingly.  If a stock has been more volatile of late, the lower the target weight will be.  The 3-month volatility stands at 20.214900 (decimal).  This is the normal returns and standard deviation of the stock price over three months annualized. 

Investors might be looking high and low for quality stocks that have fallen out of favor with the investing community. There are plenty of stocks that get continuous coverage from the big media outlets, but there are many others that may be hiding behind the scenes. Conducting thorough stock research can help the investor isolate certain stocks that might be ready for a near-term bounce. With the stock market still trading near record levels, investors will be looking for any opportunity to pounce on shares that might have been left behind for whatever reason.   

50/200 Simple Moving Average Cross

Heineken N.V. (ENXTAM:HEIA) has a 1.06206 50/200 day moving average cross value. Cross SMA 50/200 (SMA = Simple Moving Average) and is calculated as follows:

Cross SMA 50/200 = 50 day moving average / 200day moving average. If the Cross SMA 50/200 value is greater than 1, it tell us that the 50 day moving average is above the 200 day moving average (golden cross), indicating an upward moving share price.

On the other hand if the Cross SMA 50/200 value is less than 1, this shows that the 50 day moving average is below the 200 day moving average (a death cross), and tells us that share prices has fallen recently and may continue to do so.

Returns and Margins

Taking look at some key returns and margins data we can note the following:

Heineken N.V. (ENXTAM:HEIA) has Return on Invested Capital of 0.175756, with a 5-year average of 0.213924 and an ROIC quality score of 34.189663. Why is ROIC important? It’s one of the most fundamental metrics in determining the value of a given stock. It helps potential investors determine if the firm is using it’s invested capital to return profits.

When it comes to the stock market, many traders rely on technical analysis to identify trades. With technical analysis, it is generally believed that stock price movements follow trends. When the trend is determined, the thought is that price movements in the future are more likely to go in the same direction as the trend, and not against it. Another aspect of technical analysis is the idea that history tends to repeat itself especially regarding the movement of the stock’s price. Technical analysts will use chart patterns to help study market moves and identify these trends. Some traders will use highly complex charts while others may only follow a few major indicators. 

Heineken N.V. (ENXTAM:HEIA) of the Beverages sector closed the recent session at 97.400000 with a market value of $61440025.

In looking at some Debt ratios, Heineken N.V. (ENXTAM:HEIA) has a debt to equity ratio of 1.17254 and a Free Cash Flow to Debt ratio of 0.119738.  This ratio provides insight as to how high the firm’s total debt is compared to its free cash flow generated.  In terms of Net Debt to EBIT, that ratio stands at 4.61371.  This ratio reveals how easily a company is able to pay interest and capital on its net outstanding debt.  The lower the ratio the better as that indicates that the company is able to meet its interest and capital payments. Lastly we’ll take note of the Net Debt to Market Value ratio.  Heineken N.V.’s ND to MV current stands at 0.289689. This ratio is calculated as follows: Net debt (Total debt minus Cash ) / Market value of the company.

Drilling down into some additional key near-term indicators we note that the Capex to PPE ratio stands at 0.150658 for Heineken N.V. (ENXTAM:HEIA).  The Capex to PPE ratio shows you how capital intensive a company is. Stocks with an increasing (year over year) ratio may be moving to be more capital intensive and often underperform the market. Higher Capex also often means lower Free Cash Flow (Operating cash flow – Capex) generation and lower dividends as companies don’t have the cash to pay dividends if they are investing more in the business.

Investors can employ various techniques in order to study stocks. Two of the most widely used techniques are fundamental and technical analysis. Fundamental analysis includes crunching the numbers for specific companies. This may involve reviewing the cash flow statement, income statement, and balance sheet. In essence, fundamental analysts are trying to figure out the company’s value. Once the value of a company is determined, the investor can then make investment decisions based on the research. Using this method, a stock that is trading underneath the intrinsic value may be considered a good pick. Technical traders typically hold the view that all the data they need to know about a stock can be discovered to using charts.

In addition to Capex to PPE we can look at Cash Flow to Capex.  This ration compares a stock’s operating cash flow to its capital expenditure and can identify if a firm can generate enough cash to meet investment needs.  Investors are looking for a ratio greater than one, which indicates that the firm can meet that need. Comparing to other firms in the same industry is relevant for this ratio. Heineken N.V. (ENXTAM:HEIA)’s Cash Flow to Capex stands at 2.130159.

Near-Term Growth Drilldown

Now we’ll take a look at some key growth data as decimals. One year cash flow growth ratio is calculated on a trailing 12 months basis and is a one year percentage growth of a firm’s cash flow from operations.  This number stands at -0.04868 for Heineken N.V. (ENXTAM:HEIA).  The one year Growth EBIT ratio stands at 0.14253 and is a calculation of one year growth in earnings before interest and taxes.  The one year EBITDA growth number stands at 0.11702 which is calculated similarly to EBIT Growth with just the addition of amortization.

Taking even a further look we note that the 1 year Free Cash Flow (FCF) Growth is at -0.02425.  The one year growth in Net Profit after Tax is -0.06110 and lastly sales growth was 0.04894.

When compared to technical analysis, fundamental analysis typically uses a longer-term approach. Chartists may use a time horizon of days, hours, or even minutes. Fundamental analysis may track data going back many years. The difference in timeframe between the two can be seen with how each investing style may be used. Traders may only be looking to make quick trades and capitalize on short-term market movements. Longer-term investors may be looking to hold an investment for months or even years. Some investors will use a combination that studies the technicals and the fundamentals. Fundamentals may be used to identify which stock to buy, while viewing the technicals can be used to sort out the timing of the trade.

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