How sound are Rite Aid (NYSE:RAD) basic indicators given the latest surge?

RAD
 Stock
  

USD 5.05  0.11  2.13%   

There are many examples of share prices depinning after an abrupt shift in one of the basic indicators. Let's digest some of Rite Aid's important ratios. We will analyze why it could be a much better year for Rite Aid shareholders. We currently estimate Rite Aid as undervalued. The real value is approaching 8.71 per share.
Published over two months ago
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We provide trade recommendations to complement the recent expert consensus on Rite Aid Corp. Our dynamic recommendation engine exercises a multidimensional algorithm to analyze the firm's potential to grow using all technical and fundamental data available at the time.
Typically, a company's financial statements are the reports that show the financial position of the company. There are three main documents that fall into the category of financial statements. These documents include Rite Aid income statement, its balance sheet, and the statement of cash flows. Potential Rite Aid investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although Rite Aid investors may use each financial statement separately, they are all related. The changes in Rite Aid's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Rite Aid's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
The goal of Rite Aid fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of Rite Aid performance into the future periods or doing a reasonable stock valuation. The intrinsic value of Rite Aid shares is the value that is considered the true value of the share. If the intrinsic value of Rite Aid is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares Rite Aid.
Please read more on our fundamental analysis page.

Are Rite Aid Earnings Expected to grow?

The future earnings power of Rite Aid involves the interaction of many company-specific, industry, and economic forces. Earnings estimates embody investors' opinions of Rite Aid factors such as sales growth, product demand, competitive industry environment, profit margins, and cost controls. Rite Aid stock prices adjust as these expectations change or are proven wrong. The main thing to remember is that equities with high expected earnings growth tend to underperform the market because it is usually difficult to meet the market's high expectations. Companies with low earnings expectations tend to do better than expected. Please use our latest analysis of Rite Aid expected earnings.

How does Rite Aid utilize its cash?

To perform a cash flow analysis of Rite Aid, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Rite Aid is receiving and how much cash it distributes out in a given period. The Rite Aid cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Rite Aid Net Cash Flow from Operations is projected to decrease significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at 379.27 Million

Rite Aid Gross Profit

Rite Aid Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Rite Aid previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Rite Aid Gross Profit growth over the last 10 years.
Please check Gross Profit in more details.

Breaking down Rite Aid Indicators

There are few distinct groups of Rite Aid stakehholders that the SEC considers insiders. Investors usually gain information through their work as corporate directors, officers, or employees. If these individuals share the information with a friend, family, or business partner and the person who receives the information exchanges stock in the company, he or shie is also an insider. Let's take a look at how the ownership of Rite Aid is distributed among investors.

Ownership Allocation

Rite Aid Corp has a total of 55.77 Million outstanding shares. Over half of Rite Aid Corp outstanding shares are owned by third-party entities. These third-party entities are typically referred to corporate investors that secure positions in a given instrument to benefit from reduced trade commissions. Consequently, these institutions are subject to different rules and regulation than regular investors in Rite Aid. Please watch out for any change in the institutional holdings of Rite Aid Corp as this could mean something significant has changed or about to change at the company. Remember, it does not matter who owns the company or if the company is currently losing money. If the true value of the company is more than the market pays for it currently, you can still have a good investment opportunity.


Retail Investors
32.05%
Institutions
65.21%
Retail Investors32.05
Insiders2.74
Institutions65.21

Our perspective of the latest Rite Aid surge

Latest potential upside is at 8.32. Rite Aid Corp exhibits very low volatility with skewness of -0.32 and kurtosis of 0.39. However, we advise investors to further study Rite Aid Corp 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 Rite Aid'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 Rite Aid'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 Rite Aid

Although some companies within the pharmaceutical retailers industry are still a little expensive, even after the recent corrections, Rite Aid may offer a potential longer-term growth to shareholders. To conclude, as of the 29th of September 2022, our actual 90 days Buy-Hold-Sell recommendation on the firm is Strong Sell. However, we believe Rite Aid is undervalued with below average probability of bankruptcy 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 Ellen Johnson do not own shares of Rite Aid Corp. Please refer to our Terms of Use for any information regarding our disclosure principles.

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