As you reassess your portfolio, Global Blue Group warrants a closer look, especially given its positioning within the Software - Infrastructure sector. With a Wall Street target price of 5.99, the stock hovers close to its Day Typical Price of 6.02, suggesting limited immediate upside. However, the company's free cash flow of 80.6M might provide some cushion for future growth initiatives, despite a significant loss of 233.8M from financing activities. Balancing these factors, investors should weigh the potential risks against the modest upside when considering adjustments to their holdings.
Key Points
By examining the fundamental factors of Global Blue and Evertec, you can assess how market fluctuations impact their stock prices and explore whether combining them in a portfolio could mitigate risk. A pair trading strategy might involve going long on Evertec while shorting Global Blue. For more details, check out our [pair correlation module](#) on these two companies.
Let's delve into the assets. The asset utilization ratio measures the revenue generated per dollar of assets. Global Blue's ratio stands at 38.72%, indicating it earns $0.39 for every dollar of assets. An increase in this ratio suggests that Global Blue is using its assets more efficiently in daily operations.Timing is everything, especially when it comes to investing. For those holding shares in Global Blue Group, the question of whether to maintain or adjust your position is increasingly relevant. Trading on the NYSE, this technology company, specializing in software, has shown a promising trajectory with a market cap of $1.1 billion. Despite a PE ratio of 42.38, which suggests a premium valuation, the company's earnings per share of 0.13 and a strong buy consensus from analysts hint at potential upside. However, the recent change in cash, marked by a loss of $153.1 million, raises concerns about its cash flow management. With an analyst target price of $8.05, the stock offers a possible upside price of $9.56, suggesting room for growth. Yet, investors should weigh these prospects against the company's current financial health and market conditions before making portfolio decisions. Evertec's stock price jumped 3.50% today, while Global Blue saw a 12.21% increase. With growing interest in the software sector, particularly among millennials, both companies present intriguing short-term opportunities. We'll be closely examining the competitive strengths of Global Blue and Evertec to better understand their potential.
Global Blue
financial leverage refers to using borrowed capital as a funding source to finance Global Blue Group ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Global Blue 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 Global Blue'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 Global Blue'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 Global Blue's total debt and its cash.
In general, Stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Global Blue together with similar or unrelated positions with a negative correlation. For example, you can also add GigaCloud Technology to your portfolio. If GigaCloud Technology is not perfectly correlated to Global Blue it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Global Blue, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Are you currently holding both Global Blue and GigaCloud Technology in your portfolio? Please note if you are using this as a pair-trade strategy between Global Blue and GigaCloud Technology, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses. Please check Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.
Revenue Breakdown
Lets now take a look at Global Blue revenue. Based on the latest financial disclosure, Global Blue Group reported 422.3
M of revenue.
This is 89.64% lower than that of the Software sector and significantly higher than that of the
Information Technology industry. The revenue for all United States stocks is 95.52% higher than that of Global Blue. As for Evertec we see revenue of 694.71
M, which is much higher than that of the Information Technology
| Global | 422.3 Million |
| Sector | 0.0 |
| Evertec | 694.71 Million |
Warren Buffett once said, "Price is what you pay. Value is what you get." This sentiment rings true when considering Global Blue Group, a company with a market capitalization of $1.1 billion and a price-to-earnings ratio of 31.74X. With a current ratio of 1.62X, Global Blue demonstrates a reasonable ability to cover its short-term liabilities, yet its price-to-book ratio of 12.21X suggests the stock might be overvalued relative to its net assets. While the firm has a modest net income of $47.53 million, the potential upside of 4.7% could be appealing for investors seeking growth opportunities. However, the probability of bankruptcy at 45.68% is a significant risk factor that cannot be ignored, urging investors to weigh these metrics carefully when reevaluating their portfolios..
Are Global Blue technical ratios showing a correction?
Global Blue Group's coefficient of variation, currently at 1258.18, indicates significant volatility in its stock price compared to its average return. This high volatility suggests that the stock is experiencing large price swings, which could lead to a market correction. Investors should be cautious, as such fluctuations often precede price adjustments. While this doesn't necessarily mean a downturn is imminent, it does warrant a closer look at the company's fundamentals and market conditions to assess potential risks and opportunities. Global Blue's stock shows above-average downside volatility, which can be particularly impactful during bear markets.
This volatility may prompt investors to adjust their portfolios, seeking stability by diversifying their holdings as prices fluctuate.As we look ahead to 2024, Global Blue Group presents a compelling opportunity for investors willing to embrace a bit of risk for potential reward. With an analyst consensus rating of "Strong Buy" and a possible upside price of 9.56, the stock offers a promising outlook. However, it's important to weigh this against the potential downside price of 2.13, which suggests volatility could be on the horizon. For those who believe in the company's strategic direction and market positioning, this could be a chance to capitalize on its growth trajectory. As always, thorough research and consideration of your own risk tolerance are key before making any investment decisions..
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.
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