Any investors would pay particular attention to the profitability of a company before considering taking a position. Here we’ll take a quick look at shares of Sigma Designs, Inc. (NASDAQ:SIGM) and the company’s ability to generate profit. The firm currently has a Return on Equity -10.60% which is derived from comparing 12-months net income to shareholder equity. So even though the company is generating profits, where can the stock go from here? Sell-side analysts covering the shares are projecting a one year price target of $8.58 on the stock. When comparing this to a recent price of $6.75, the potential upside should be noted. Taking analyst recommendations into consideration results in a Buy/Sell consensus recommendation of 2.50. This is according to all of the analysts polled by First Call.
What makes a stock profitable? Let’s look at a few factors.
Rising EPS (Earnings Per Share)
Businesses must be able to have competitive advantages and must produce value to consumers in the form of desirable goods and services. When a business has a strong brand, they can afford to raise prices and also have a differentiated product that is more desirable compared to their competition. A business that is able to grow earnings per share can afford to pay a rising dividend. Sigma Designs, Inc. (NASDAQ:SIGM)’s trailing 12-months EPS is -0.43.
Sigma Designs, Inc. (NASDAQ:SIGM)’s performance this year to date is 12.50%. The stock has performed 10.66% over the last seven days, 17.39% over the last thirty, and -9.64% over the last three months. Over the last six months, Sigma Designs, Inc.’s stock has been -4.93% and 9.58% for the year.
RSI and Recommendations
Sigma Designs, Inc.’s RSI is 60.24. Based on the stock’s volatility for the week, which is a statistical measure of the dispersion of returns for a given stock and represents average daily high/low percentage range of 4.82% and month of 3.51%.
There are a number of sell-side analysts who have recently weighed in on the firm. As stated earlier, the consensus target price is $8.58 with a mean recommendation of 2.50 (1-5 scale).
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