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When should you exit your Chromadex Corp (USA Stocks:CDXC) holdings?

November 6, 2024  By
Chromadex Corp has earned a "Strong Buy" rating from five analysts. To enhance this expert consensus, we offer trading advice through our advanced recommendation system. This system evaluates the company's growth potential by analyzing both technical and fundamental data. Currently, Chromadex's profit margin stands at a mere 0.02%, indicating that even a slight drop in revenue could lead to losses. This margin is significantly below the industry average. Additionally, the operating margin is just 0.06%, meaning the company earns only $0.06 in operating income for every $100 in sales. These figures suggest that while the stock is rated highly, investors should be cautious about its financial health.

Key Arguments

With Chromadex Corp's stock showing a notable price percent change of 14.4, now might be the ideal moment to reevaluate your investment strategy, especially considering the stock's accumulation distribution stands at a robust 256.1K. This could signal a strong investor interest and potential for future growth, making it a compelling time to reassess your position in this dynamic player within the packaged foods industry.
Published over three weeks ago
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Reviewed by Michael Smolkin

Timing is everything, especially when it comes to investing. As Chromadex Corp continues to capture attention on the NASDAQ, investors are buzzing about its potential. With a strong buy consensus from analysts and a target price estimated at 5.17, there's a palpable sense of anticipation surrounding this consumer defensive stock. However, it's crucial to weigh these optimistic projections against the company's recent performance, which includes a reported loss. This moment presents a unique opportunity to reevaluate your investment strategy, considering both the potential upside and the inherent risks. As we navigate this unique economic climate, Chromadex Corp might surprise investors in the coming week. Recent price movements hint at a potential rebound in December. Currently, Chromadex Corp is trading at $6.99. The company's historical hype elasticity stands at 0.27, compared to an industry average of 0.19. It's expected that the stock will rise following the next press release, potentially reaching $6.35. However, the stock's volatility, driven by headline impacts, exceeds 100%, making social media predictions less reliable. The anticipated price increase with the next news is around 3.93%, while the daily expected return is 1.7%. With a 90-day investment horizon, the next announcement is expected in about nine days.
The successful prediction of Chromadex Corp stock price could yield a significant profit to investors. But is it possible? The efficient-market hypothesis suggests that all published stock prices of traded companies, such as Chromadex Corp, already reflect all publicly available information. This academic statement is a fundamental principle of many financial and investing theories used today. However, the typical investor usually disagrees with a 'textbook' version of this hypothesis and continually tries to find mispriced stocks to increase returns. We use internally-developed statistical techniques to arrive at the intrinsic value of Chromadex Corp based on Chromadex Corp hews, social hype, general headline patterns, and widely used predictive technical indicators. We also calculate exposure to Chromadex Corp's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Chromadex Corp's related companies.

Use Technical Analysis to project Chromadex expected Price

Chromadex Corp technical stock analysis exercises models and trading practices based on price and volume transformations, such as the moving averages, relative strength index, regressions, price and return correlations, business cycles, stock market cycles, or different charting patterns.
A focus of Chromadex Corp technical analysis is to determine if market prices reflect all relevant information impacting that market. A technical analyst looks at the history of Chromadex Corp trading pattern rather than external drivers such as economic, fundamental, or social events. It is believed that price action tends to repeat itself due to investors' collective, patterned behavior. Hence technical analysis focuses on identifiable price trends and conditions. More Info...

How important is Chromadex Corp's Liquidity

Chromadex Corp financial leverage refers to using borrowed capital as a funding source to finance Chromadex Corp ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Chromadex Corp 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 Chromadex Corp'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 Chromadex Corp'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 Chromadex Corp's total debt and its cash.

Chromadex Corp Gross Profit

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

Details

The company reported the previous year's revenue of 83.57 M. Net Loss for the year was (4.94 M) with profit before overhead, payroll, taxes, and interest of 42.8 M.
 2021 2022 2023 2024 (projected)
Short Long Term Debt Total4.7M4.3M3.3M1.7M
Total Assets57.8M54.1M55.0M28.4M

Current Deferred Revenue Breakdown

Chromadex Corp's Current Deferred Revenue is decreasing over the years with stable fluctuation. Overall, Current Deferred Revenue is expected to go to about 263.8 K this year. Current Deferred Revenue usually refers to revenue that has been collected but not yet earned, typically from prepaid service contracts or subscriptions. This amount is considered a liability until the service is provided or the subscription period ends. At present, Chromadex Corp's Current Deferred Revenue is projected to decrease significantly based on the last few years of reporting.
2017
2018
2019
2020
2021
2022
2023
2024
2017314,335
2018275,000
2019169,000
2020278,000
2021161,000
2022157,000
2023195,000
2024263,770
As the saying goes, "Timing is everything in investing," and for Chromadex Corp, now might be the moment to reevaluate your strategy. With a market capitalization of $466.7 million and a promising target price of $7.20, Chromadex presents intriguing prospects for investors. Despite the modest profit margin of 0.02%, the company's solid working capital of $28.91 million provides a buffer to navigate market uncertainties. The insider ownership of 35.39% suggests confidence from those closest to the company, potentially aligning their interests with shareholders. As you consider your next move, weigh these factors carefully to determine if Chromadex aligns with your investment goals.

Over 3 percent surge for Chromadex Corp. What does it mean for shareholders?

Chromadex Corp's recent stock increase of over 3% is encouraging for shareholders, especially with the company's information ratio rising above 0.16. This figure, which evaluates risk-adjusted returns, indicates that Chromadex is effectively managing its volatility while still delivering returns. For investors, this suggests a potentially more stable and rewarding investment, as the company seems to be balancing risk and performance well. The improved information ratio might also signal enhanced operational efficiencies or successful strategic initiatives, offering a positive outlook for shareholders. However, Chromadex Corp is experiencing above-average volatility. Understanding these market trends can help investors make informed decisions.
High volatility, especially in bear markets, can significantly affect stock prices, prompting investors to adjust their portfolios as prices fluctuate.Considering the current dynamics surrounding Chromadex Corp, investors are faced with a decision that hinges on both potential risks and opportunities. The stock's valuation market value sits at 6.99, which suggests room for growth when juxtaposed with the analyst's highest estimated target price of 5.74. This discrepancy might indicate an undervaluation or a market mispricing, presenting a possible upside. Furthermore, the analyst overall consensus leans towards a strong buy, supported by three strong buy recommendations. However, it's crucial to weigh these optimistic signals against the inherent volatility and specific challenges the company may face. Ultimately, whether to hold or divest depends on your risk tolerance and investment horizon..

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Editorial Staff

Rifka Kats is a Member of Macroaxis Editorial Board. Rifka writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce. 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 Rifka Kats do not own shares of Chromadex Corp. Please refer to our Terms of Use for any information regarding our disclosure principles.

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