Computing the Quant Signals on Tile Shop Holdings, Inc. (NasdaqGS:TTS) Shares as Price to Cash Ratio Hits 7.807080

The Price to book ratio is the current share price of a company divided by the book value per share.  The Price to Book ratio for Tile Shop Holdings, Inc. NasdaqGS:TTS is 1.434993.  A lower price to book ratio indicates that the stock might be undervalued.  Similarly, Price to cash flow ratio is another helpful ratio in determining a company’s value.  The Price to Cash Flow for Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 7.807080.  This ratio is calculated by dividing the market value of a company by cash from operating activities.  Additionally, the price to earnings ratio is another popular way for analysts and investors to determine a company’s profitability.  The price to earnings ratio for Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 28.193523. This ratio is found by taking the current share price and dividing by earnings per share.

When certain portfolio stocks are performing poorly, investors may be prone to chase higher return stocks or move into safer stocks. As most investors know, short-term results have the ability to be somewhat misleading. Deviating from a well-crafted plan based on short-term market fluctuations can lead to portfolio trouble in the future. Having the proper mix of stocks in the portfolio may also be beneficial to longer-term performance. Pinpointing overall investment goals and regularly reviewing portfolio positions can help the investor stay on track. 

Watching some historical volatility numbers on shares of Tile Shop Holdings, Inc. (NasdaqGS:TTS), we can see that the 12 month volatility is presently 46.174900. The 6 month volatility is 49.990900, and the 3 month is spotted at 52.689900. Following volatility data can help measure how much the stock price has fluctuated over the specified time period. Although past volatility action may help project future stock volatility, it may also be vastly different when taking into account other factors that may be driving price action during the measured time period. 

We can now take a quick look at some historical stock price index data. Tile Shop Holdings, Inc. (NasdaqGS:TTS) presently has a 10 month price index of 0.59589. The price index is calculated by dividing the current share price by the share price ten months ago. A ratio over one indicates an increase in share price over the period. A ratio lower than one shows that the price has decreased over that time period. Looking at some alternate time periods, the 12 month price index is 0.52695, the 24 month is 0.22716, and the 36 month is 0.22553. Narrowing in a bit closer, the 5 month price index is 0.60478, the 3 month is 0.73529, and the 1 month is currently 1.01942.

Valuation Ratios

Looking at some ROIC (Return on Invested Capital) numbers, Tile Shop Holdings, Inc. (NasdaqGS:TTS)’s ROIC is 0.045127. The ROIC 5 year average is 0.152238 and the ROIC Quality ratio is 6.766668. ROIC is a profitability ratio that measures the return that an investment generates for those providing capital. ROIC helps show how efficient a firm is at turning capital into profits.  In terms of EBITDA Yield, Tile Shop Holdings, Inc. (NasdaqGS:TTS) currently has a value of 0.103147. This value is derived by dividing EBITDA by Enterprise Value.

The Price to Book ratio (Current share price / Book value per share) is a good valuation measure you can use to find undervalued investment ideas.  A low Price to Book could indicate that the shares are undervalued in their industry.  Generally speaking a P/B ratio under 1 is considered low and is best used in relation to asset-heavy firms.  At the time of writing Tile Shop Holdings, Inc. (NasdaqGS:TTS) has a price to book ratio of 1.434993.

The direction of stock market moves in the short-term are highly unpredictable. Many investors will be tempted to ride the wave whether the trend is buying or selling. Fearful investors may make hasty decisions such as panic buying or selling. Investors may feel compelled to buy stocks after a major run higher. This can be related to the fear or missing out. On the other end, investors may be quick to sell quality stocks when the market is in the midst of a broad sell-off. This behavior often translates into falling into the trap of buying high and selling low. 

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The Leverage Ratio of Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 0.607939. Leverage ratio is the total debt of a company divided by total assets of the current and past year divided by two. Companies take on debt to finance their day to day operations. The leverage ratio can measure how much of a company’s capital comes from debt. With this ratio, investors can better estimate how well a company will be able to pay their long and short term financial obligations.

There are many different tools to determine whether a company is profitable or not.  One of the most popular ratios is the “Return on Assets” (aka ROA).  This score indicates how profitable a company is relative to its total assets.  The Return on Assets for Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 0.028320.  This number is calculated by dividing net income after tax by the company’s total assets.  A company that manages their assets well will have a higher return, while a company that manages their assets poorly will have a lower return.

The Value Composite One (VC1) is a method that investors use to determine a company’s value.  The VC1 of Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 25.  A company with a value of 0 is thought to be an undervalued company, while a company with a value of 100 is considered an overvalued company.  The VC1 is calculated using the price to book value, price to sales, EBITDA to EV, price to cash flow, and price to earnings.  Similarly, the Value Composite Two (VC2) is calculated with the same ratios, but adds the Shareholder Yield.  The Value Composite Two of Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 20.

One of the biggest mistakes that can plague the individual investor is not setting up an overall investment plan. Investors may want to start out be setting up an outline of overall goals. Having goals can eventually make the day to day investing decisions at little bit easier over time. Once a plan is in place, investors can then spend more time focusing on the proper stocks to add to the portfolio. Dedicating time for extensive stock research may not be easy, but it may put the investor in a better position. Some investors will go to greater lengths, such as making sure that they have a good reason behind every buy or sell decision. This process may seem unnecessary to some, but it may help the investor stay focused when the market gets choppy and tough decisions need to be made.

At the time of writing, Tile Shop Holdings, Inc. (NasdaqGS:TTS) has a Piotroski F-Score of 5. The F-Score may help discover companies with strengthening balance sheets. The score may also be used to spot the weak performers. Joseph Piotroski developed the F-Score which employs nine different variables based on the company financial statement. A single point is assigned to each test that a stock passes. Typically, a stock scoring an 8 or 9 would be seen as strong. On the other end, a stock with a score from 0-2 would be viewed as weak.

The Price to book ratio is the current share price of a company divided by the book value per share.  The Price to Book ratio for Tile Shop Holdings, Inc. NasdaqGS:TTS is 1.434993.  A lower price to book ratio indicates that the stock might be undervalued.  Similarly, Price to cash flow ratio is another helpful ratio in determining a company’s value.  The Price to Cash Flow for Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 7.807080.  This ratio is calculated by dividing the market value of a company by cash from operating activities.  Additionally, the price to earnings ratio is another popular way for analysts and investors to determine a company’s profitability.  The price to earnings ratio for Tile Shop Holdings, Inc. (NasdaqGS:TTS) is 28.193523. This ratio is found by taking the current share price and dividing by earnings per share.

Looking at the current landscape of the equity market, investors may be doing some bargain hunting for stocks to add to the portfolio. Many sharp investors will welcome temporary market dips which may provide plenty of buying opportunities. Being prepared for these types of opportunities can help the investor make quick decisions in the midst of a downturn. As we move closer to the close of the year, investors will be closely watching the next round of company earnings reports. Even if the individual investor chooses to trade conservatively during earnings, they can still do the necessary research and have stocks lined up to purchase when the time is right.     

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