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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
New Relic, Inc. (XNYS:NEWR) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NEWR
Name:
NEW RELIC, INC. (XNYS:NEWR)
Sector:
4.79M
Industry:
Software�Infrastructure
CEO:
Mr. Lewis Cirne
Total Employees:
2,217
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -74.06% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NEW RELIC, INC.(NEWR) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SOFTWARE�INFRASTRUCTURE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
58.93
One Month Price Target:
$59.25
Six Month Price Target :
$60.84
Likely Price in One Year's Time:
Ticker:
$62.74
Likely Trading Range Today Under (Normal Volatility)
$58.58
Price Upper limit ($) :
$59.35
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$54.27
This week:
$48.51
This month :
$38.1
Other Primary facts
Market Cap:
3.99B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
67.31M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
38.52%
-28.35%
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:
$80.55
$70.64
$37.31
$47.22
Medium risk (<10%) entry points
Buy Call
Sell Call
$67.42
Buy Put:
Sell Put:
$65.31
$50.41
$52.55
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NEWR
Sharpe Ratio:
1.28%
Comparison:
NEWR, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -21.94% lower than the industry
& is -44.01% lower than the market/S&P 500 average
Average Returns/Yield of
NEWR
Daily returns:
0.06%
Weekly returns:
0.29%
Monthly returns:
1.17%
Yearly returns:
14.38%
Comparison of returns:
Average annual returns/yield (last 3 years) is -2.67% below industry average
Classification:
NEWR, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.96
Statistical test of Returns:
NEWR has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.88%
Weekly Volatility:
8.67%
Monthly Volatility:
17.34%
Yearly Volatility:
60.07%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
2.67%
Volatility in last five trading days has been -31.14% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.90%
Weekly VaR:
-17.68%
Monthly VaR:
-35.35%
How Much Can the price of
NEWR
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-31%
Worst case (decline):
>85%
This translates to price declining to:
$40.90
This translates to price declining to:
$8.84
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
NEWR is a 149.51% riskier investment compared to the market/S&P 500 & is 113.75% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 16.37% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NEWR
Beta in relation to market/S&P 500--0.96
Expected beta in 1 year's time:
0.696
Expected beta in 3 year's time:
0.984
Unlevered (debt free) Beta:
0.373
Beta in relation to Nasdaq (XNAS):
1.011
Beta in relation to all global stocks::
0.735
Beta Comparison & Analysis
Beta of competitors/peers::
1.325
Beta is -27.37% lower than peers
Average Industry Beta:
1.112
Beta is -13.42% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.043
Alpha is 17.63% above industry average alpha yield
Alpha is 271% higher than market/& is unsustainably high
Analysis of Cost of Capital of
NEWR
Equity cost of capital:
0.097
Equity cost of capital is -9.49% below industry mean WACC
Unlevered (without debt) cost of capital:
3.77%
Before-tax cost of debt:
0.44%
After-tax cost of debt:
0.35%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.35%
WACC is -23.38% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$11.67
Revenue growth rate per share of (3Y):
11.33
Annual revenue growth rate is -5.68% below industry average
EPS:
-$3.88
Expected Annual growth rate of EPS (3Y):
77.40%
Expected future EPS growth rate is 156.94% higher than the Software�Infrastructure industry
Free cash flow (FCF) per share:
-
-
-
Debt per share
$8.22
EBITDA per share
-$1.59
Valuation Analysis Today of
NEWR
P/E Ratio:
0
P/E Ratio of Competitors/Peers:
52
P/E ratio is -100.00% lower than main peers & is higher than the industry
-
NEWR is -123.28% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
5.05
Price to sales ratio is -54.02% below the industry mean
P/B (Price to book value ratio):
11.33
-
-
Net income growth rate (3Y):
281.46%
Net income growth rate is -96.68% 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:
158.07%
Net debt to equity ratio:
86.05%
Debt to assets ratio:
41.67%
Net debt to assets ratio:
22.69%
Debt-to-asset ratio is -40.24% below industry average
Ability to repay debt:
Interest coverage ratio:
-43.41
Interest coverage ratio is -79.43% less than industry average
Looking forward:
Debt growth rate:
-44.96%
Annual debt growth is -142% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.42
Statistical significance of correlation:
NEWR has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.48
Stock price is -12.51% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.48
Correlation of price movement with Nasdaq (^IXIC):
0.005
Covariance of price movement with the market:
0.012
Kurtosis
22.118
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
0.676
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
NEWR
Gross Profit Margin Ratio:
269%
Operating Profit Margin Ratio:
-29.10%
Operating profit margin is 145.15% higher than the industry
Net Profit Margin Ratio:
269%
Effective Tax Rate:
-0.14%
Effective tax rate is -100.44% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-68.91%
Return on equity (ROE) is -164.55% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-18.17%
Return on assets (ROA) is 379.75% higher than the industry
Financial Leverage:
1.7x
Current Ratio:
2.42
Current ratio is 3.75% above industry average
Cash Conversion Cycle (days):
48
Cash conversion cycle is -57.33% below industry average
The remaining useful life of property plant & equipment is: 10.3 years
Stock based compensation to net income ratio:
-17.48%
In-depth Efficiency Analysis
Revenue generated per employee:
354.3K
Each employee generates -10% less revenue than industry average revenue per employee
EBITDA generated per employee:
- 48.3K
Each employee generates -174% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 108.8K
Each employee generates -620% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
2.2K
Each employee generates -89% less free cash flow than industry average revenue per employee
Assets/Capital per employee
163.4K
Each employee generates -89% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 18.02%
Growth rate in R&D investment/expenditure is -794.77% lower than the industry
Competitors/Peer firms of
NEWR
ENVESTNET, INC. (XNYS:ENV)
CLDR
Sunnova Energy International Inc. (XNYS:NOVA)
ROGERS CORPORATION (XNYS:ROG)
BOX, INC. (XNYS:BOX)
LIVERAMP HOLDINGS, INC. (XNYS:RAMP)
MDLA
ONTO INNOVATION INC. (XNYS:ONTO)
SAILPOINT TECHNOLOGIES HOLDINGS, INC. (XNYS:SAIL)
Current Analyst Ratings
Strong buy�17%
Buy�25%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
785.52M
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:
256.28M
529.24M
211.86M
151.91M
545.94M
394.03M
-
757.80M
2.86M
2.47M
131.49M
- 107002.00K
- 228553.00K
- 241281.00K
- 231782.00K
323.00K
- 241281.00K
Statement of Cash Flow
Date:
Period:
23.03M
Differed Income Tax :
-
Stock Based Compensation :
42.19M
Change in Working Capital :
19.05M
Accounts Receivables:
80.55M
Other Working Capital:
- 66583.00K
Other Non-Cash Items:
4.02M
Net Cash Provided by Operating Activities:
9.87M
Investments in PP&E:
- 2226.00K
Net Acquisitions:
- 7192.00K
Purchases of Investments:
- 23828.00K
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):
6/30/21
2022
Q1
259.90M
557.22M
817.12M
93.48M
-
55.20M
965.80M
139.68M
163.68M
21.61M
-
-
37.33M
362.29M
-
1.33B
27.63M
7.71M
-
316.46M
48.10M
399.90M
553.47M
23.53M
578.05M
-
977.95M
64.00K
- 611320.00K
- 850.0K
962.25M
June 30, 2021 at 6:00:00 AM
1.01B
350.14M
1.33B
-
561.19M
301.3M
40.51M
- 2860.00K
4.41M
-
-
-
-
4.80M
4.80M
-
19.08M
265.54M
246.46M
9.87M
- 5086.00K
4.79M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NEWR
2023
2024
2025
2026
2027
$62.94
$67.01
$71.34
$75.96
$80.87