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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Conn'S, Inc. (XNAS:CONN) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
CONN
Name:
CONN'S, INC. (XNAS:CONN)
Sector:
- 23251.00K
Industry:
Specialty Retail
CEO:
Mr. Norman Miller
Total Employees:
4,000
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -425.71% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF CONN'S, INC.(CONN) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SPECIALTY RETAIL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
9.4
One Month Price Target:
$9.52
Six Month Price Target :
$10.13
Likely Price in One Year's Time:
Ticker:
$10.87
Likely Trading Range Today Under (Normal Volatility)
$9.32
Price Upper limit ($) :
$9.5
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$8.36
This week:
$7.08
This month :
$4.76
Other Primary facts
Market Cap:
200.07M
Market Cap Classification:
Micro Cap
Number of Shares
IPO Date:
23.90M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
27.91%
-24.74%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$14.21
$12.01
$4.59
$6.79
Medium risk (<10%) entry points
Buy Call
Sell Call
$11.29
Buy Put:
Sell Put:
$10.82
$7.51
$7.98
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
CONN
Sharpe Ratio:
1.60%
Comparison:
CONN, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -43.91% lower than the industry
& is -29.61% lower than the market/S&P 500 average
Average Returns/Yield of
CONN
Daily returns:
0.10%
Weekly returns:
0.48%
Monthly returns:
1.92%
Yearly returns:
34.92%
Comparison of returns:
Average annual returns/yield (last 3 years) is -34.14% below industry average
Classification:
CONN, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.59
Statistical test of Returns:
CONN has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
5.42%
Weekly Volatility:
12.12%
Monthly Volatility:
24.24%
Yearly Volatility:
83.98%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
6.05%
Volatility in last five trading days has been 11.62% above long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-11.04%
Weekly VaR:
-24.68%
Monthly VaR:
-49.36%
How Much Can the price of
CONN
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-43%
Worst case (decline):
>85%
This translates to price declining to:
$5.40
This translates to price declining to:
$1.41
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
CONN is a 248.40% riskier investment compared to the market/S&P 500 & is 198.47% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 30.52% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
CONN
Beta in relation to market/S&P 500--2.32
Expected beta in 1 year's time:
1.161
Expected beta in 3 year's time:
1.642
Unlevered (debt free) Beta:
1.129
Beta in relation to Nasdaq (XNAS):
0.862
Beta in relation to all global stocks::
1.022
Beta Comparison & Analysis
Beta of competitors/peers::
1.672
Beta is 38.87% higher than peers
Average Industry Beta:
1.43
Beta is 62.39% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
20.39%
Sustainable growth rate is -38.59% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.039
Alpha is -82.06% below industry average alpha yield
Alpha is 251% higher than market/& is unsustainably high
Analysis of Cost of Capital of
CONN
Equity cost of capital:
0.191
Equity cost of capital is 47.21% above industry mean WACC
Unlevered (without debt) cost of capital:
9.27%
Before-tax cost of debt:
2.48%
After-tax cost of debt:
1.96%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.96%
WACC is 38.87% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$65.52
Revenue growth rate per share of (3Y):
0.37
Annual revenue growth rate is -106.33% below industry average
EPS:
$2.33
Expected Annual growth rate of EPS (3Y):
15.71%
Expected future EPS growth rate is -55.38% lower than the Specialty Retail industry
Free cash flow (FCF) per share:
$1.55
-
-
Debt per share
$35.04
EBITDA per share
$6.62
Valuation Analysis Today of
CONN
P/E Ratio:
7.88
P/E Ratio of Competitors/Peers:
31.63
P/E ratio is -75.08% lower than main peers & is -63.36% lower than the industry
Stock price/value with industry average P/E ratio: $50.12
CONN is -81.24% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.14
Price to sales ratio is -96.47% below the industry mean
P/B (Price to book value ratio):
0.37
Price to free cash flow: 6.07
Price to free cash flow ratio is -88.85% lower than the industry
Net income growth rate (3Y):
-152.10%
Net income growth rate is -67.86% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
138.73%
Net debt to equity ratio:
146.25%
Debt to assets ratio:
49.79%
Net debt to assets ratio:
52.49%
Debt-to-asset ratio is -31.18% below industry average
Ability to repay debt:
Interest coverage ratio:
7.17
Interest coverage ratio is -71.06% less than industry average
Looking forward:
Debt growth rate:
-5.03%
Annual debt growth is -107% lower than industry average debt growth rate
Debt repayment rate in last quarter: 28.35%
Analysis of Key Statistics
Correlation of price movement with the market:
0.359
Statistical significance of correlation:
CONN has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.475
Stock price is -24.37% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.475
Correlation of price movement with Nasdaq (^IXIC):
-0.016
Covariance of price movement with the market:
-0.05
Kurtosis
4.962
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.533
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
CONN
Gross Profit Margin Ratio:
191%
Operating Profit Margin Ratio:
7.20%
Operating profit margin is 10.69% higher than the industry
Net Profit Margin Ratio:
191%
Effective Tax Rate:
23.84%
Effective tax rate is 5.70% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
11.43%
Return on equity (ROE) is 703.69% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
4.10%
Return on assets (ROA) is -55.90% lower than the industry
Financial Leverage:
2.0x
Current Ratio:
3.74
Current ratio is 98.24% above industry average
Cash Conversion Cycle (days):
115.8
Cash conversion cycle is 78.95% above industry average
The remaining useful life of property plant & equipment is: 0.0 years
Stock based compensation to net income ratio:
3.81%
In-depth Efficiency Analysis
Revenue generated per employee:
391.5K
Each employee generates -47% less revenue than industry average revenue per employee
EBITDA generated per employee:
39.6K
Each employee generates -84% less EBITDA than industry average revenue per employee
Profit generated per employee:
17.3K
Each employee generates -88% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 5.8K
Each employee generates -114% less free cash flow than industry average revenue per employee
Assets/Capital per employee
217.0K
Each employee generates -114% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
CONN
Betterware de Mexico SAPI de CV (XNAS:BWMX)
TRAVELCENTERS OF AMERICA INC. (XNAS:TA)
AEYE, INC (XNAS:LIDR)
FUNKO, INC. (XNAS:FNKO)
RUTH'S HOSPITALITY GROUP, INC. (XNAS:RUTH)
OneWater Marine Inc (XNAS:ONEW)
GrowGeneration Corp. (XNAS:GRWG)
LIQUIDITY SERVICES, INC. (XNAS:LQDT)
AMERICA'S CAR-MART, INC. (XNAS:CRMT)
Current Analyst Ratings
Strong buy�8%
Buy�4%
Hold�4%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
1.57B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
819.49M
746.66M
-
280.57M
551.22M
-
80.05M
631.28M
-
22.08M
45.54M
158.25M
112.71M
69.03M
90.63M
21.61M
69.03M
Statement of Cash Flow
Date:
Period:
11.40M
Differed Income Tax :
890.00K
Stock Based Compensation :
2.63M
Change in Working Capital :
- 90300.00K
Accounts Receivables:
- 47341.00K
Other Working Capital:
- 26657.00K
Other Non-Cash Items:
47.88M
Net Cash Provided by Operating Activities:
- 9263.00K
Investments in PP&E:
- 13988.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
6.57M
-
6.57M
541.95M
202.90M
62.60M
814.01M
447.29M
-
-
-
-
420.87M
868.15M
-
1.68B
64.95M
52.00M
1.84M
15.45M
85.12M
217.52M
837.60M
23.27M
860.87M
-
1.08B
328.00K
536.41M
-
67.04M
October 31, 2021 at 12:00:00 AM
1.45B
603.77M
1.68B
-
889.60M
883.0M
-
-
- 13988.00K
- 331364.00K
-
-
-
351.04M
19.68M
-
- 3572.00K
36.13M
39.70M
- 9263.00K
- 13988.00K
- 23251.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
CONN
2023
2024
2025
2026
2027
$10.92
$38.64
$44.66
$51.63
$59.69