Investors looking to take advantage of cash heavy shares, they might look first to the cash flow of a company, and how fast that is growing.  Farmer Bros. Co. (NasdaqGS:FARM)  currently has one year cash flow growth of -0.79965 1yr Growth Cash Flow = 1 year percentage growth of a company’s Cash Flow from operations (Cash Flow Statement). Analyzing cash flow can alert shareholders to potential dangers that may result from a lack of liquidity. Looking at the positive or negative movement of a company’s reported free cash flow will help determine if it has the necessary funds to finance capital expenditures and keep paying dividends.

Some investors will scour the markets looking for cheap, quality stocks. These stocks can be attractive for investors looking to find a bargain that could turn into a big winner. Investors may be cautious when searching for these types of stocks. Often times, a stock will see a huge jump and then everyone will hop on the bandwagon to buy without checking into the fundamentals. Sometimes this strategy may work out, but in many cases, the stock has already made the run and become too expensive to add to the portfolio. Conducting diligent research and constantly adding to the individual’s overall market education level may help the investor sift through the sea of stocks and find those names that are really worth getting into.

In taking a look at some other key growth stats we note that the one year Growth EBIT ratio stands at -1.99778 for Farmer Bros. Co. (NasdaqGS:FARM) and is a calculation of one year growth in earnings before interest and taxes. The one year EBITDA growth number stands at -0.63356 which is calculated similarly to EBIT Growth with just the addition of amortization.

Taking even a further look we note that the 1 year Free Cash Flow (FCF) Growth is at -0.46843. The one year growth in Net Profit after Tax is 2.10389 and lastly sales growth was 0.02137.

Farmer Bros. Co. (NasdaqGS:FARM) has a present suggested portfolio ownership rate of 0.03520 (as a decimal) ownership. Target weight is the volatility adjusted recommended position size for a stock in your portfolio. The maximum target weight is 7% for any given holding. The indicator is based off of the 100 day volatility reading and calculates a target weight accordingly. The more recent volatility of a stock, the lower the target weight will be. The 3-month volatility stands at 42.107300 (decimal). This is the normal returns and standard deviation of the stock price over three months annualized.

Diving down into some additional near-term indicators we see that the Capex to PPE ratio stands at 0.208873 for Farmer Bros. Co. (NasdaqGS:FARM). The Capex to PPE ratio shows you how capital intensive a company is. Stocks with an increasing (year over year) ratio may be moving to be more capital intensive and often underperform the market. Higher Capex also often means lower Free Cash Flow (Operating cash flow – Capex) generation and lower dividends as companies don’t have the cash to pay dividends if they are investing more in the business.

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When it comes to investing in the equity market, discipline can play a major role in achieving ones goals. A few bad moves can send the investor’s confidence spiraling. Acting purely on emotion can lead to impulsive decisions that may cause the losses to pile up. Creating a solid plan and following through with the plan can help investors stay on track and focus on the proper details. Markets are constantly going up and down and the investing ride can sometimes be a bumpy one. Being able to see the big picture and focus on the important data can help keep the investor tuned in to the right channel. Investors who expect to jump into the market and immediately start raking in the profits may find out fairly quickly that trading without a plan can be a recipe for defeat. 

In looking at some key ratios we note that the Piotroski F Score stands at 4 (1 to 10 scale) and the ERP5 rank holds steady at 12622. The Q.I. Value of Farmer Bros. Co. (NasdaqGS:FARM) currently reads 65.00000 on the Quant scale. The Free Cash Flow score of 1.119427 is also swinging some momentum at investors. The United States of America based firm is currently valued at 1476.

Some other notable ratios include the Accrual Ratio of -0.267947, the Altman Z score of 2.519138, a Montier C-Score of 4.00000 and a Value Composite rank of 53.

Although the investing process is fairly straightforward, securing consistent returns in the stock market is not easy. Throwing hard earned money at un-researched investments can eventually lead the investor down the road to ruin. Every individual investor may have different goals when starting out. Aligning these goals with a specific plan can create a solid foundation for the future. Nobody can predict what the future will hold, but being aware of market conditions can be a great asset when attempting to navigate the terrain while mitigating risk. Once the vision of the individual investor is clear, the road to sustaining profits may be much easier to travel.

In addition to Capex to PPE we can look at Cash Flow to Capex. This ration compares a stock’s operating cash flow to its capital expenditure and can identify if a firm can generate enough cash to meet investment needs. Investors are looking for a ratio greater than one, which indicates that the firm can meet that need. Comparing to other firms in the same industry is relevant for this ratio. Farmer Bros. Co. (NasdaqGS:FARM)’s Cash Flow to Capex stands at 0.200290.

As company earnings reports continue to roll in, investors will be watching to see which companies hit their numbers for the last reporting period. Investors will also be watching which sectors are reporting the best earnings numbers. A positive overall earnings season could mean that the stock market could keep climbing. Many investors may be cautious with the market trading at current levels. Even though the gloom and doom prognosticators are out in full force, investors have to do the research and decide for themselves which way they believe the market will move in the next couple of months.   

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