Avadel Stock Story

AVDL -  USA Stock  

USD 8.14  0.38  4.46%

As many investors are getting excited about healthcare space, Avadel Pharmaceuticals and Mind Medicine may be going in opposite directions. We are going to summarize some of the competitive aspects of both Avadel and Mind Medicine.
Published over a month ago
View all stories for Avadel Pharmaceuticals | View All Stories
Mind Medicine Mindmed vs Avadel Pharmaceuticals Plc
By analyzing existing fundamental indicators between Avadel Pharmaceuticals and Mind Medicine, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Mind Medicine with a short position in Avadel Pharmaceuticals. Check out our pair correlation module for more information.

Let's begin by analyzing the assets.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Avadel Pharmaceuticals has an asset utilization ratio of 4.07 percent. This denotes that the company is making $0.0407 for each dollar of assets. An increasing asset utilization means that Avadel Pharmaceuticals Plc is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as Avadel or Mind Medicine is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

How important is Avadel Pharmaceuticals's Liquidity

Avadel Pharmaceuticals financial leverage refers to using borrowed capital as a funding source to finance Avadel Pharmaceuticals Plc ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Avadel Pharmaceuticals 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 Avadel Pharmaceuticals's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Avadel Pharmaceuticals, but it might be worth checking our own buy vs. sell analysis

Correlation Between Avadel and Mind Medicine Mindmed

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 Avadel Pharmaceuticals together with similar or unrelated positions with a negative correlation. For example, you can also add Mind Medicine to your portfolio. If Mind Medicine is not perfectly correlated to Avadel Pharmaceuticals 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 Avadel Pharmaceuticals for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Please check pair correlation details between AVDL and MNMD for more information.

Note

Are you currently holding both Avadel Pharmaceuticals and Mind Medicine in your portfolio?
Please note if you are using this as a pair-trade strategy between Avadel Pharmaceuticals and Mind Medicine, 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.

Is Avadel Pharmaceuticals valued accurately by the market?

Cash and Equivalents Breakdown

Now, let's check Avadel Pharmaceuticals cash and equivalents. In accordance with the recently published financial statements, Avadel Pharmaceuticals Plc has 204.26 M in Cash and Equivalents. This is 75.12% lower than that of the Healthcare sector and significantly higher than that of the Drug Manufacturers—Specialty & Generic industry. The cash and equivalents for all United States stocks is 92.44% higher than that of the entity. As for Mind Medicine we see cash and equivalents of 159.99 M, which is much higher than that of the Drug Manufacturers—Specialty & Generic

Avadel204.26 Million
Sector0.0
Mind Medicine159.99 Million
204.3 M
Avadel
Sector
160 M
Mind Medicine

Possible November correction of Avadel?

The jensen alpha is down to 0.64 as of today. Avadel Pharmaceuticals Plc currently demonstrates below-average downside deviation. It has Information Ratio of 0.19 and Jensen Alpha of 0.64. However, we advise investors to further question Avadel Pharmaceuticals Plc expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Avadel Pharmaceuticals' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Avadel Pharmaceuticals' 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 Takeaway

While some other entities under the drug manufacturers—specialty & generic industry are still a bit expensive, Avadel Pharmaceuticals may offer a potential longer-term growth to stakeholders. Taking everything into account, as of the 16th of October 2021, we believe Avadel Pharmaceuticals is currently undervalued. It almost mirrors the market and projects below average chance of distress in the next two years. Our present 90 days buy-or-sell advice on the company is Strong Buy.

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 Raphi Shpitalnik do not own shares of Avadel Pharmaceuticals Plc. Please refer to our Terms of Use for any information regarding our disclosure principles.

Would you like to provide feedback on the content of this article?

You can get in touch with us directly or send us a quick note via email to editors@macroaxis.com