With a Target Weight of 0.07000, Is -0.18754 Cash Flow Change For Hydro One Limited (TSX:H) Enough for Investors?

Investors looking to take advantage of cash heavy shares, they might look first to the cash flow of a company, and how fast that is growing.  Hydro One Limited (TSX:H)  currently has one year cash flow growth of -0.18754 1yr Growth Cash Flow = 1 year percentage growth of a company’s Cash Flow from operations (Cash Flow Statement). Analyzing cash flow can alert shareholders to potential dangers that may result from a lack of liquidity. Looking at the positive or negative movement of a company’s reported free cash flow will help determine if it has the necessary funds to finance capital expenditures and keep paying dividends.

Managing the stock portfolio can be a very challenging task. To manage the portfolio successfully, it can take a lot of dedicated time, effort, and perseverance. Studying the market and being in tune with the economic landscape can help investors gain the knowledge that is needed to come out on top. Controlling emotions and consistently following a plan may be the keys to keep the investor on track. As many seasoned investors know, the stock market can be a wild ride full of many ups and downs. Being able to stay calm and focused during the rocky periods can assist the investor when making those highly important portfolio decisions.  

In taking a look at some other key growth stats we note that the one year Growth EBIT ratio stands at -0.01607 for Hydro One Limited (TSX:H) and is a calculation of one year growth in earnings before interest and taxes. The one year EBITDA growth number stands at 0.00198 which is calculated similarly to EBIT Growth with just the addition of amortization.

Taking even a further look we note that the 1 year Free Cash Flow (FCF) Growth is at -0.10201. The one year growth in Net Profit after Tax is -1.19499 and lastly sales growth was 0.07194.

Hydro One Limited (TSX:H) has a present suggested portfolio ownership rate of 0.07000 (as a decimal) ownership. Target weight is the volatility adjusted recommended position size for a stock in your portfolio. The maximum target weight is 7% for any given holding. The indicator is based off of the 100 day volatility reading and calculates a target weight accordingly. The more recent volatility of a stock, the lower the target weight will be. The 3-month volatility stands at 9.099500 (decimal). This is the normal returns and standard deviation of the stock price over three months annualized.

Diving down into some additional near-term indicators we see that the Capex to PPE ratio stands at 0.067940 for Hydro One Limited (TSX:H). The Capex to PPE ratio shows you how capital intensive a company is. Stocks with an increasing (year over year) ratio may be moving to be more capital intensive and often underperform the market. Higher Capex also often means lower Free Cash Flow (Operating cash flow – Capex) generation and lower dividends as companies don’t have the cash to pay dividends if they are investing more in the business.

Dedicated investors often strive hard to set themselves up for success. Finding long-lasting success in the stock market may not be an easy endeavor. The mindset of a short-term trader may differ greatly from that of a long-term investor. Investors often have to be prepared for many different situations. Obtaining the proper knowledge about stocks and the investing world is typically a main goal for active traders and investors. Once the investor is armed with knowledge, they may be able to see things that others cannot. This may involve staying up to date on various fundamentals, technicals, and macro-economic conditions. 

In looking at some key ratios we note that the Piotroski F Score stands at 3 (1 to 10 scale) and the ERP5 rank holds steady at 8870. The Q.I. Value of Hydro One Limited (TSX:H) currently reads 39.00000 on the Quant scale. The Free Cash Flow score of -0.555188 is also swinging some momentum at investors. The Canada based firm is currently valued at 11444.

Some other notable ratios include the Accrual Ratio of -0.053481, the Altman Z score of 1.032736, a Montier C-Score of 3.00000 and a Value Composite rank of 45.

New investors may be looking at the soaring stock market and wondering if now is a good time to try and get in on the action. Leaping into the market without proper research or a solid plan may leave the investor on the short end of the stick. Creating a stock investing plan can be as simple or complex as the individual chooses. Sometimes, keeping things simple may be the best way to go. Other times, there may be more than meets the eye, and a deep-dive into the crucial data may be required. New investors may be extremely excited to start buying stocks. They may have heard some great water cooler talk about the next big stock. There is always a possibility that the hot stock chatter may end up coming to fruition, but it could just as likely turn out to be terribly erroneous. Many individuals in the financial world will be quick to provide these can’t lose picks, but until this information is thoroughly researched, investors may want to proceed with caution.

In addition to Capex to PPE we can look at Cash Flow to Capex. This ration compares a stock’s operating cash flow to its capital expenditure and can identify if a firm can generate enough cash to meet investment needs. Investors are looking for a ratio greater than one, which indicates that the firm can meet that need. Comparing to other firms in the same industry is relevant for this ratio. Hydro One Limited (TSX:H)’s Cash Flow to Capex stands at 0.932720.

There are many factors that can affect the health of a company. This is one reason why stock trading can be extremely difficult at times. Because there are always so many things to take into consideration, it may be next to impossible to create a formula that will continually beat the market. Even after all the data has been scrutinized and the numbers have been crunched, the investor still has to make sense of the information and figure out what to do with it. Knowing how to use the information about publically traded companies can end up being the difference between handsome gains and devastating losses. 

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