Business

Is iCAD, Inc. (NasdaqCM:ICAD) Generating Enough Cash? FCF Growth as 0.336590

Free Cash Flow Growth (FCF Growth) is the free cash flow of the current year minus the free cash flow from the previous year, divided by last year’s free cash flow.  The FCF Growth of iCAD, Inc. (NasdaqCM:ICAD) is 0.336590.  Free cash flow (FCF) is the cash produced by the company minus capital expenditure.  This cash is what a company uses to meet its financial obligations, such as making payments on debt or to pay out dividends.  The Free Cash Flow Score (FCF Score) is a helpful tool in calculating the free cash flow growth with free cash flow stability – this gives investors the overall quality of the free cash flow.  The FCF Score of iCAD, Inc. (NasdaqCM:ICAD) is 0.987499.  Experts say the higher the value, the better, as it means that the free cash flow is high, or the variability of free cash flow is low or both.

Investors may be intent on creating unique strategies when approaching the equity markets. Individuals with longer-term mindsets may have completely different strategies than those who trade in the short-term. Whatever class they fall under, investors may have to decide how aggressive they want to be in order to capitalize on these strategies. Navigating the bull market may make things a bit easier for some and much harder for others. Many investors will set their sights on dips and corrections. This may prove to be a successful strategy, but this may also create many missed opportunities. Keeping track of key economic data along with market trends and earnings information typically seems to be a boon to any strategy. Highly active traders may keep close watch after the markets have a sleepy session or two. Investors staying the course might actually be relieved when activity cools a bit. 

The Piotroski F-Score is a scoring system between 1-9 that determines a firm’s financial strength.  The score helps determine if a company’s stock is valuable or not.  The Piotroski F-Score of iCAD, Inc. (NasdaqCM:ICAD) is 4.  A score of nine indicates a high value stock, while a score of one indicates a low value stock.  The score is calculated by the return on assets (ROA), Cash flow return on assets (CFROA), change in return of assets, and quality of earnings.  It is also calculated 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 MF Rank (aka the Magic Formula) is a formula that pinpoints a valuable company trading at a good price.  The formula is calculated by looking at companies that have a high earnings yield as well as a high return on invested capital.  The MF Rank of iCAD, Inc. (NasdaqCM:ICAD) is 15629.  A company with a low rank is considered a good company to invest in.  The Magic Formula was introduced in a book written by Joel Greenblatt, entitled, “The Little Book that Beats the Market”.

Shifting gears, we can see that iCAD, Inc. (NasdaqCM:ICAD) has a Q.i. Value of 72.00000. The Q.i. Value ranks companies using four ratios. These ratios consist of EBITDA Yield, FCF Yield, Liquidity, and Earnings Yield. The purpose of the Q.i. Value is to help identify companies that are the most undervalued. Typically, the lower the value, the more undervalued the company tends to be.

Checking in on some valuation rankings, iCAD, Inc. (NasdaqCM:ICAD) has a Value Composite score of 86. Developed by James O’Shaughnessy, the VC score uses five valuation ratios. These ratios are price to earnings, price to cash flow, EBITDA to EV, price to book value, and price to sales. The VC is displayed as a number between 1 and 100. In general, a company with a score closer to 0 would be seen as undervalued, and a score closer to 100 would indicate an overvalued company. Adding a sixth ratio, shareholder yield, we can view the Value Composite 2 score which is currently sitting at 85.

Watching some historical volatility numbers on shares of iCAD, Inc. (NasdaqCM:ICAD), we can see that the 12 month volatility is presently 56.941800. The 6 month volatility is 61.881000, and the 3 month is spotted at 73.581500. Following volatility data can help measure how much the stock price has fluctuated over the specified time period. Although past volatility action may help project future stock volatility, it may also be vastly different when taking into account other factors that may be driving price action during the measured time period. 

The C-Score is a system developed by James Montier that helps determine whether a company is involved in falsifying their financial statements.  The C-Score is calculated by a variety of items, including a growing difference in net income verse cash flow, increasing days outstanding, growing days sales of inventory, increasing assets to sales, declines in depreciation, and high total asset growth.  The C-Score of iCAD, Inc. (NasdaqCM:ICAD) is 1.00000.  The score ranges on a scale of -1 to 6.  If the score is -1, then there is not enough information to determine the C-Score.  If the number is at zero (0) then there is no evidence of fraudulent book cooking, whereas a number of 6 indicates a high likelihood of fraudulent activity. The C-Score assists investors in assessing the likelihood of a company cheating in the books.

Shareholder Yield, Shareholder Yield (Mebane Faber)

The Shareholder Yield is a way that investors can see how much money shareholders are receiving from a company through a combination of dividends, share repurchases and debt reduction. The Shareholder Yield of iCAD, Inc. (NasdaqCM:ICAD) is -0.016149. This percentage is calculated by adding the dividend yield plus the percentage of shares repurchased. Dividends are a common way that companies distribute cash to their shareholders. Similarly, cash repurchases and a reduction of debt can increase the shareholder value, too. Another way to determine the effectiveness of a company’s distributions is by looking at the Shareholder yield (Mebane Faber). The Shareholder Yield (Mebane Faber) of iCAD, Inc. NasdaqCM:ICAD is -0.01698. This number is calculated by looking at the sum of the dividend yield plus percentage of sales repurchased and net debt repaid yield.

Valuation

The Price to book ratio is the current share price of a company divided by the book value per share. The Price to Book ratio for iCAD, Inc. NasdaqCM:ICAD is 8.979932. A lower price to book ratio indicates that the stock might be undervalued. Similarly, Price to cash flow ratio is another helpful ratio in determining a company’s value. The Price to Cash Flow for iCAD, Inc. (NasdaqCM:ICAD) is -21.425495. This ratio is calculated by dividing the market value of a company by cash from operating activities. Additionally, the price to earnings ratio is another popular way for analysts and investors to determine a company’s profitability. The price to earnings ratio for iCAD, Inc. (NasdaqCM:ICAD) is -8.853046. This ratio is found by taking the current share price and dividing by earnings per share.

With most major indexes showing strength, it is safe to assume that many investors may have their heads in the clouds. With many stocks frequently hitting new milestone highs, investors may be scrambling to make sure that they aren’t missing out on possible returns. Maybe some stocks have been doing well, but others not in the portfolio have been doing much better. There is rarely any substitute for hard work and dedication. Investors may get complacent with stocks that they are familiar with. Branching out into uncharted waters may help broaden the horizon and start the gears grinding for new trading ideas. Traders and investors will no doubt be closely monitoring the markets as we move into the second half of the year. It remains to be seen whether optimism or pessimism will rule going in to the next round of quarterly earnings reporting.

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