Jefferies Financial Group has roughly 9.7
B in cash with 1.8
B of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 180.91, which can makes it an attractive takeover target, given it will continue generating positive cash flow.
Investing in Jefferies Financial, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Jefferies Financial along with other instruments in the same portfolio. Using conventional
technical analysis and
fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.
Sophisticated investors, who have witnessed
many market ups and downs, anticipate that the market will even out over time. This tendency of Jefferies Financial's price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy.
How important is Jefferies Financial's Liquidity
Jefferies Financial
financial leverage refers to using borrowed capital as a funding source to finance Jefferies Financial Group ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Jefferies Financial 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 Jefferies Financial'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 Jefferies Financial'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 Jefferies Financial's total debt and its cash.
Jefferies Financial Gross Profit
Jefferies Financial Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Jefferies Financial 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 Jefferies Financial Gross Profit growth over the last 10 years. Please check Jefferies Financial's
gross profit and other
fundamental indicators for more details.
Jefferies Financial Correlation with Peers
Investors in Jefferies can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Jefferies Financial Group. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Jefferies Financial and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Jefferies is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with
your current brokerage. Please check
volatility of Jefferies for more details
What is driving Jefferies Financial Investor Appetite?
We consider Jefferies Financial very steady.
Jefferies Financial holds Efficiency (Sharpe) Ratio of 0.02, which attests that the entity had 0.02% of return per unit of risk over the last 3 months. Our standpoint towards determining the volatility of a stock is to use all available market data together with stock-specific
technical indicators that cannot be
diversified away. We have found twenty-one
technical indicators for Jefferies Financial, which you can use to evaluate the future volatility of the firm. Please check out Jefferies Financial Market Risk Adjusted Performance of 0.0374,
risk adjusted performance of 0.0292, and Downside Deviation of 1.57 to validate if the risk estimate we provide is consistent with the expected return of 0.038%.
Some Jefferies technical indicators suggest bounce-back
Downside variance is down to 2.47. It may hint to a possible volatility drop.
Jefferies Financial Group has relatively low volatility with skewness of 0.93 and kurtosis of 2.08. However, we advise all investors to independently investigate Jefferies Financial Group to ensure
all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different
market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Jefferies Financial's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact
Jefferies Financial's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
Our Final Take On Jefferies Financial
While some firms within the capital markets industry are still a little expensive, even after the recent corrections, Jefferies Financial may offer a potential longer-term growth to stockholders. To conclude, as of the 27th of June 2023, our current 90 days buy-sell recommendation on the company is
Strong Hold. We believe Jefferies Financial is
undervalued with
very small probability of financial unrest for the next two years.
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Aina Ster is a Member of Macroaxis Editorial Board. Aina delivers weekly perspective on ongoing market and economic trends, analysis and tips from predictive analysis to forecasting across various financial instruments.
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 Aina Ster do not own shares of Jefferies Financial Group. Please refer to our
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