Investors Are Circling Computer Modelling Group Ltd. (TSX:CMG), CRH Medical Corporation (TSX:CRH), What Do the Numbers Tell Us?

The Current Ratio of Computer Modelling Group Ltd. (TSX:CMG) is 2.29.  The Current Ratio is used by investors to determine whether a firm can pay short term and long term debts.  The current ratio looks at all the liquid and non-liquid assets compared to the firm’s total current liabilities.  A high current ratio reveals that the firm has little trouble managing their working capital.  A low current ratio (when the current liabilities are higher than the current assets) reveals that the firm may have trouble paying their short term obligations.

Periodically, investors may have to decide when to sell a winner. This can be one of the tougher portfolio decisions to make. When a winning stock keeps rising, it can be tough to part with it. Investors may become hesitant to sell because they don’t want to miss out on greater profits in the future. Sometimes this strategy will work, and other times investors may be watching all previous gains evaporate. Being able to sell a winner can provide obvious profits, and it may even be a confidence booster for the average investor. On the flip side, investors may also be faced with the decision of when to sell a loser. Even the most researched trades can go sour. Being able to detach from the trade mentally can end up saving the investor more grief down the line. Holding onto a stock with the hopes of a giant turnaround can be a recipe for portfolio disaster. Being able to cut losses is just as much a part of the process as being able to cash in winners. Learning from mistakes and being able to wipe the slate clean can assist the investor be better prepared for future endeavors in the markets. 

Volatility & Price

Stock volatility is a percentage that reveals whether a stock is a desirable purchase.  Investors look at the Volatility 12m to determine if a firm has a low volatility percentage or not over the course of a year.  The Volatility 12m of Computer Modelling Group Ltd. (TSX:CMG) is 26.769100.  This is determined by taking weekly log normal returns and standard deviation of the equity price over one year annualized.  The lower the number, a firm is thought to have low volatility.  The Volatility 3m is a similar percentage determined by the daily log normal returns and standard deviation of the equity price over 3 months.  The Volatility 3m of Computer Modelling Group Ltd. (TSX:CMG) is 38.081700.  The Volatility 6m is the same, except measured over the course of six months.  The Volatility 6m is 35.766900.

We can now take a quick peek at some historical stock price index data. Computer Modelling Group Ltd. (TSX:CMG) right now has a 10 month price index of 0.76241. The price index is determined by dividing the current equity price by the equity price ten months ago. A ratio over one reveals an increase in equity price over the duration. A ratio lower than one shows that the price has decreased over that time duration. Studying at some different time periods, the 12 month price index is 0.78457, the 24 month is 0.82391, and the 36 month is 0.96897. Narrowing in a bit closer, the 5 month price index is 0.83274, the 3 month is 0.89427, and the 1 month is currently 1.05649.

The Leverage Ratio of Computer Modelling Group Ltd. (TSX:CMG) is 0.000000.  Leverage ratio is the total debt of a firm divided by total assets of the current and past year divided by two.  Companies take on debt to finance their day to day operations.  The leverage ratio can calculate how much of a firm’s capital comes from debt.  With this ratio, investors can better estimate how well a firm will be able to pay their long and short term financial obligations.

C-Score
Computer Modelling Group Ltd. (TSX:CMG) currently has a Montier C-score of 1.00000. This indicator was developed by James Montier in an attempt to identify firms that were cooking the books in order to appear better on paper. The score ranges from zero to six where a 0 would indicate no evidence of book cooking, and a 6 would indicate a high likelihood. A C-score of -1 would indicate that there is not enough information available to calculate the score. Montier used six inputs in the calculation. These inputs included a growing difference between net income and cash flow from operations, increasing receivable days, growing day’s sales of inventory, increasing other current assets, decrease in depreciation relative to gross property plant and equipment, and high total asset growth.

F Score, ERP5 and Magic Formula

The Piotroski F-Score is a scoring system between 1-9 that determines a firm’s financial strength.  The score helps determine if a firm’s stock is valuable or not.  The Piotroski F-Score of Computer Modelling Group Ltd. (TSX:CMG) is 4.  A score of nine reveals a high value stock, while a score of one reveals a low value stock.  The score is determined by the return on assets (ROA), Cash flow return on assets (CFROA), change in return of assets, and quality of earnings.  It is also determined by a change in gearing or leverage, liquidity, and change in shares in issue.  The score is also determined by change in gross margin and change in asset turnover.

The ERP5 Rank is an investment gadget that analysts use to uncover undervalued companies.  The ERP5 looks at the Price to Book ratio, Earnings Yield, ROIC and 5 year average ROIC.  The ERP5 of Computer Modelling Group Ltd. (TSX:CMG) is 5665.  The lower the ERP5 rank, the more undervalued a firm is thought to be. The MF Rank (aka the Magic Formula) is a formula that pinpoints a valuable firm trading at a good price.  The formula is determined by studying at companies that have a high earnings yield as well as a high return on invested capital.  The MF Rank of Computer Modelling Group Ltd. (TSX:CMG) is 3894.  A firm with a low rank is considered a good firm to invest in.  The Magic Formula was introduced in a book written by Joel Greenblatt, entitled, “The Little Book that Beats the Market”.

Shareholder Yield

The Q.i. Value of Computer Modelling Group Ltd. (TSX:CMG) is 33.00000.  The Q.i. Value is a useful gadget in determining if a firm is undervalued or not.  The Q.i. Value is determined using the following ratios: EBITDA Yield, Earnings Yield, FCF Yield, and Liquidity.  The lower the Q.i. value, the more undervalued the firm is thought to be.  The Value Composite One (VC1) is a method that investors use to determine a firm’s value.  The VC1 of Computer Modelling Group Ltd. (TSX:CMG) is 65.  A firm with a value of 0 is thought to be an undervalued firm, while a firm with a value of 100 is considered an overvalued firm.  The VC1 is determined using the price to book value, price to sales, EBITDA to EV, price to cash flow, and price to earnings.  Similarly, the Value Composite Two (VC2) is determined with the same ratios, but adds the Shareholder Yield.  The Value Composite Two of Computer Modelling Group Ltd. (TSX:CMG) is 52.

When it comes to securing profits in the share market, investors may be trying to find a perfect system to assist attain that goal. Dedicated investors may try strategies that have been passed on to them from other seasoned investors. Even after reading every piece of literature about investing, it might be crucial to determine which way is the best way to successfully conquer the market.  Studying up on firm fundamentals and following technical stock levels can be a good place to start, but creating and implementing a plan can be difficult. As we all know, markets change over time. What drives a market during one point in time may not drive the market at a future date. what to look for when studying technical levels or fundamentals may assist lead down the path to increased profits. Many investors will single out to study the indicators with the highest probability of forecasting future market action. 

CRH Medical Corporation (TSX:CRH) right now has a current ratio of 1.98. The current ratio, also known as the working capital ratio, is a liquidity ratio that displays the proportion of current assets of a business relative to the current liabilities. The ratio is simply determined by dividing current liabilities by current assets. The ratio may be used to provide an idea of the ability of a certain firm to pay back its liabilities with assets. Typically, the higher the current ratio the better, as the firm may be more capable of paying back its obligations.

Investors may be diving into the latest firm earnings reports trying to scope out some quality stocks to add to the portfolio. Nobody knows for sure which way overall market momentum will sway as we near the close of the calendar year. Investors may be getting ready to do a portfolio review to see which stocks are worthy to hold, and which ones have underperformed a may have to be unloaded. Regularly monitoring stock investments may keep the investor ready for any big market changes that may occur.

Volatility & Price

Stock volatility is a percentage that reveals whether a stock is a desirable purchase.  Investors look at the Volatility 12m to determine if a firm has a low volatility percentage or not over the course of a year.  The Volatility 12m of CRH Medical Corporation (TSX:CRH) is 41.869100.  This is determined by taking weekly log normal returns and standard deviation of the equity price over one year annualized.  The lower the number, a firm is thought to have low volatility.  The Volatility 3m is a similar percentage determined by the daily log normal returns and standard deviation of the equity price over 3 months.  The Volatility 3m of CRH Medical Corporation (TSX:CRH) is 43.675800.  The Volatility 6m is the same, except measured over the course of six months.  The Volatility 6m is 48.072900.

We can now take a quick peek at some historical stock price index data. CRH Medical Corporation (TSX:CRH) right now has a 10 month price index of 1.32258. The price index is determined by dividing the current equity price by the equity price ten months ago. A ratio over one reveals an increase in equity price over the duration. A ratio lower than one shows that the price has decreased over that time duration. Studying at some different time periods, the 12 month price index is 1.30725, the 24 month is 0.52018, and the 36 month is 1.32647. Narrowing in a bit closer, the 5 month price index is 0.78846, the 3 month is 1.03917, and the 1 month is currently 1.10269.

F Score, ERP5 and Magic Formula

The Piotroski F-Score is a scoring system between 1-9 that determines a firm’s financial strength.  The score helps determine if a firm’s stock is valuable or not.  The Piotroski F-Score of CRH Medical Corporation (TSX:CRH) is 6.  A score of nine reveals a high value stock, while a score of one reveals a low value stock.  The score is determined by the return on assets (ROA), Cash flow return on assets (CFROA), change in return of assets, and quality of earnings.  It is also determined by a change in gearing or leverage, liquidity, and change in shares in issue.  The score is also determined by change in gross margin and change in asset turnover.

The ERP5 Rank is an investment gadget that analysts use to uncover undervalued companies.  The ERP5 looks at the Price to Book ratio, Earnings Yield, ROIC and 5 year average ROIC.  The ERP5 of CRH Medical Corporation (TSX:CRH) is 3305.  The lower the ERP5 rank, the more undervalued a firm is thought to be. The MF Rank (aka the Magic Formula) is a formula that pinpoints a valuable firm trading at a good price.  The formula is determined by studying at companies that have a high earnings yield as well as a high return on invested capital.  The MF Rank of CRH Medical Corporation (TSX:CRH) is 2697.  A firm with a low rank is considered a good firm to invest in.  The Magic Formula was introduced in a book written by Joel Greenblatt, entitled, “The Little Book that Beats the Market”.

The Leverage Ratio of CRH Medical Corporation (TSX:CRH) is 0.326963.  Leverage ratio is the total debt of a firm divided by total assets of the current and past year divided by two.  Companies take on debt to finance their day to day operations.  The leverage ratio can calculate how much of a firm’s capital comes from debt.  With this ratio, investors can better estimate how well a firm will be able to pay their long and short term financial obligations.

The Q.i. Value of CRH Medical Corporation (TSX:CRH) is 14.00000.  The Q.i. Value is a useful gadget in determining if a firm is undervalued or not.  The Q.i. Value is determined using the following ratios: EBITDA Yield, Earnings Yield, FCF Yield, and Liquidity.  The lower the Q.i. value, the more undervalued the firm is thought to be.  The Value Composite One (VC1) is a method that investors use to determine a firm’s value.  The VC1 of CRH Medical Corporation (TSX:CRH) is 38.  A firm with a value of 0 is thought to be an undervalued firm, while a firm with a value of 100 is considered an overvalued firm.  The VC1 is determined using the price to book value, price to sales, EBITDA to EV, price to cash flow, and price to earnings.  Similarly, the Value Composite Two (VC2) is determined with the same ratios, but adds the Shareholder Yield.  The Value Composite Two of CRH Medical Corporation (TSX:CRH) is 34.

C-Score
CRH Medical Corporation (TSX:CRH) currently has a Montier C-score of 3.00000. This indicator was developed by James Montier in an attempt to identify firms that were cooking the books in order to appear better on paper. The score ranges from zero to six where a 0 would indicate no evidence of book cooking, and a 6 would indicate a high likelihood. A C-score of -1 would indicate that there is not enough information available to calculate the score. Montier used six inputs in the calculation. These inputs included a growing difference between net income and cash flow from operations, increasing receivable days, growing day’s sales of inventory, increasing other current assets, decrease in depreciation relative to gross property plant and equipment, and high total asset growth.

Active traders are often studying for the next great move to secure profits in the share market. Traders might be tracking stocks that are primed for a breakout. When a stock unexpectedly breaks to the upside, it has the potential to bring the optimistic crowd along with it. The breakout may bring in traders who missed out on the beginning of a run trying to capitalize on the back end. The professional trader is typically one who is able to stand out from the crowd. Being able to separate fantasy from reality can mean big profits for the dedicated trader. Impulse buying or selling on good or bad news is common in the share market. Being able to come to a reasonable conclusion about why stock prices are headed one way and not the other can be a tough proposition. Paying attention to all the headlines may lead some traders down the path of no return if trades are being made strictly on daily news or even perception or that news. Discerning between what is actually driving a stock and what is perceived to be driving a stock may end up being a large factor between future gains and losses in the equity market.

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