Is Madison (NYSE:MSGE) outlook still optimistic?

MSGE
 Stock
  

USD 47.18  2.27  4.59%   

While some baby boomers are getting worried about communication services space, it is reasonable to digest Madison Square Garden against economic and market trends. As expected, Madison Square is starting to reaffirm its true potential as shareholders are becoming more and more confident in the future outlook. The company returns are highly-related to returns on the market. As market moves, the company is expected to follow. The appearance of sound technical and fundamental indicators of the firm indicates a shorter-term price swing for shareholders of Madison. Madison Square Garden is scheduled to announce its earnings today. The next fiscal year end is expected on the 22nd of August 2022. The stock experiences an active upward rally.
Published over a month ago
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The company's average rating is Buy from 3 analysts. Do analysts base this consensus on technical analyses? We know that typical technical analysis utilizes price momentum, patterns, and trends looking at historical prices. It aims to identify signals based on Madison Square market sentiment investors' perception of the future value of Madison. Let us look at a few aspects of Madison technical analysis. The company has Profit Margin (PM) of (44.18) %, which may suggest that it does not properly executes on its current pricing strategies or is unable to control all of the operational costs. This is way below average. Similarly, it shows Operating Margin (OM) of (37.77) %, which suggests for every $100 dollars of sales, it generated a net operating loss of -0.38.
Using predictive technical analysis, we will analyze different prices and returns patterns and diagnose historical swings to determine the real value of Madison Square Garden. In general, we focus on analyzing Madison Square stock price patterns and their correlations with different microeconomic environment and drivers. We also apply predictive analytics to build Madison Square's daily price indicators and compare them against related drivers such as momentum indicators and various other types of predictive indicators. Using this methodology combined with a more conventional technical analysis and fundamental analysis, we attempt to find the most accurate representation of Madison Square's intrinsic value. In addition to deriving basic predictive indicators for Madison Square, we also check how macroeconomic factors affect Madison Square price patterns. Please read more on our technical analysis page or use our predictive modules below to complement your research.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Madison Square'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 Madison Square 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 Madison Square. Your research has to be compared to or analyzed against Madison Square's peers to derive any actionable benefits. When done correctly, Madison Square'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 Madison Square Garden.

How important is Madison Square's Liquidity

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

How does Madison utilize its cash?

To perform a cash flow analysis of Madison Square, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Madison Square is receiving and how much cash it distributes out in a given period. The Madison Square cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Closer look at Madison Square Semi Variance

Madison Square Garden has current Semi Variance of 6.29. Semi-variance provides a good measure of downside volatility for equity or a portfolio. It is similar to variance, but it only looks at periods where the returns are less than the target or average level.

Semi-variance is the square of semi-deviation. Semi-variance is calculated by averaging the deviations of returns that have a result that is less than the mean.

Semi Variance 
 = 
SUM(RET DEV)2 
N(ZERO) 
 = 
6.29
SUM = Summation notation
RET DEV = Actual return deviation over selected period
N(ZERO) = Number of points with returns less than zero
Let's now compare Madison Square Semi Variance to its closest peers:
MSGE
SIRI
TRV
MSGE6.2892234039264485
SIRI2.75
TRV2.63

Madison Square implied volatility may change after the surge

The kurtosis is down to 1.63 as of today. Madison Square Garden currently demonstrates below-average downside deviation. It has Information Ratio of -0.01 and Jensen Alpha of -0.02. However, we advise investors to further question Madison Square Garden 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 Madison Square'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 Madison Square'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 Takeaway on Madison Square Investment

Although some other companies under the entertainment industry are still a bit expensive, Madison Square may offer a potential longer-term growth to shareholders. To conclude, as of the 19th of August 2022, our research shows that Madison Square is a rather very steady investment opportunity with a below average probability of distress in the next two years. From a slightly different view, the entity currently appears to be undervalued. Our present 90 days recommendation on the firm is 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 Gabriel Shpitalnik do not own shares of Madison Square Garden. Please refer to our Terms of Use for any information regarding our disclosure principles.

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