Is Republic First (NASDAQ:FRBK) way too risky for millennials?

FRBK
 Stock
  

USD 2.58  0.07  2.79%   

Lets try to examine the odds of Republic First to fully recover from the recent plunge as its shares went up 0.34%. The entity current daily volatility is 4.03 percent, with a beta of 1.02 and an alpha of -0.45 over DOW. While some millenniums are indifferent towards stable market, it makes sense to examine Republic First Bcp. We will cover the possibilities of making Republic First into a steady grower in October.
Published over two months ago
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The company conducts business under Financial Services sector and is part of Banks—Regional industry. Republic First Bcp currently holds 11.28 M in liabilities with Debt to Equity (D/E) ratio of 0.2, which may suggest Republic First is not taking enough advantage from borrowing. Debt can assist Republic First until it has trouble settling it off, either with new capital or with free cash flow. So, Republic First's shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Republic First Bcp sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Republic to invest in growth at high rates of return. When we think about Republic First's use of debt, we should always consider it together with cash and equity.
Investing in Republic First, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Republic First along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Republic First's price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy. Please use the tools below to analyze the current value of Republic First in the context of predictive analytics.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Republic First. Your research has to be compared to or analyzed against Republic First's peers to derive any actionable benefits. When done correctly, Republic First's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy towards taking a position in Republic First Bancorp.

How important is Republic First's Liquidity

Republic First financial leverage refers to using borrowed capital as a funding source to finance Republic First Bancorp ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Republic First 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. Please check the breakdown between Republic First's total debt and its cash.

How does Republic utilize its cash?

To perform a cash flow analysis of Republic First, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Republic First is receiving and how much cash it distributes out in a given period. The Republic First cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Republic First Net Cash Flow from Operations is increasing as compared to previous years. The last year's value of Net Cash Flow from Operations was reported at 82.63 Million

Republic First Correlation with Peers

Investors in Republic can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Republic First Bancorp. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Republic First and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Republic is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage.
Please check volatility of Republic for more details

Breaking down Republic First Further

Republic First Bcp maintains Sharpe Ratio (i.e., Efficiency) of -0.0991, which implies the firm had -0.0991% of return per unit of risk over the last 3 months. Macroaxis standpoint towards forecasting the risk of any stock is to look at both systematic and unsystematic factors of the business, including all available market data and technical indicators. Republic First Bcp exposes twenty-seven different technical indicators, which can help you to evaluate volatility that cannot be diversified away. Please be advised to check Republic First Bcp coefficient of variation of (818.89), and Risk Adjusted Performance of (0.13) to confirm the risk estimate we provide.

Republic technical analysis signifies possible correction

The jensen alpha is down to -0.45 as of today. Republic First Bcp exhibits very low volatility with skewness of 1.97 and kurtosis of 10.39. However, we advise investors to further study Republic First Bcp technical indicators to ensure that all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Republic First's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Republic First's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Our Final Take On Republic First

Although many of the other players within the banks—regional industry are still a little expensive, even after the recent corrections, Republic First may offer a potential longer-term growth to traders. To conclude, as of the 25th of September 2022, our primary 90 days buy-hold-sell recommendation on the firm is Strong Sell. However, we believe Republic First is fairly valued with very low odds of financial distress for the next two years.

Editorial Staff

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 Vlad Skutelnik do not own shares of Republic First Bancorp. Please refer to our Terms of Use for any information regarding our disclosure principles.

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