Xenon Pharmaceuticals Inc. (NasdaqGM:XENE) vs. Polar Power, Inc. (NasdaqCM:POLA): How are these stocks valued?

Checking in on some valuation rankings, Xenon Pharmaceuticals Inc. (NasdaqGM:XENE) has a Value Composite score of 92. Developed by James O’Shaughnessy, the VC score uses five valuation ratios. These ratios are price to earnings, price to cash flow, EBITDA to EV, price to book value, and price to sales. The VC is displayed as a number between 1 and 100. In general, a company with a score closer to 0 would be seen as undervalued, and a score closer to 100 would indicate an overvalued company. Adding a sixth ratio, shareholder yield, we can view the Value Composite 2 score which is currently sitting at 94. 

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In taking a look at some other notable technicals, Xenon Pharmaceuticals Inc. (NasdaqGM:XENE)’s ROIC is -5.342463. The ROIC 5 year average is -0.049368 and the ROIC Quality ratio is -0.120908. 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.

The Q.i. Value of Xenon Pharmaceuticals Inc. (NasdaqGM:XENE) is 50.00000.  The Q.i. Value is a helpful tool in determining if a company is undervalued or not.  The Q.i. Value is calculated using the following ratios: EBITDA Yield, Earnings Yield, FCF Yield, and Liquidity.  The lower the Q.i. value, the more undervalued the company is thought to be.

The FCF Yield 5yr Average is calculated by taking the five year average free cash flow of a company, and dividing it by the current enterprise value.  Enterprise Value is calculated by taking the market capitalization plus debt, minority interest and preferred shares, minus total cash and cash equivalents.  The average FCF of a company is determined by looking at the cash generated by operations of the company.  The Free Cash Flow Yield 5 Year Average of Xenon Pharmaceuticals Inc. (NasdaqGM:XENE) is 0.172228. 

Shareholder Yield
We also note that Xenon Pharmaceuticals Inc. (NasdaqGM:XENE) has a Shareholder Yield of -0.249618 and a Shareholder Yield (Mebane Faber) of -0.00745. The first value is calculated by adding the dividend yield to the percentage of repurchased shares. The second value adds in the net debt repaid yield to the calculation. Shareholder yield has the ability to show how much money the firm is giving back to shareholders via a few different avenues. Companies may issue new shares and buy back their own shares. This may occur at the same time. Investors may also use shareholder yield to gauge a baseline rate of return.

MF Rank
Xenon Pharmaceuticals Inc. (NasdaqGM:XENE) has a current MF Rank of 17569. Developed by hedge fund manager Joel Greenblatt, the intention of the formula is to spot high quality companies that are trading at an attractive price. The formula uses ROIC and earnings yield ratios to find quality, undervalued stocks. In general, companies with the lowest combined rank may be the higher quality picks.

PI
We can now take aquick look at some historical stock price index data. Xenon Pharmaceuticals Inc. (NasdaqGM:XENE) presently has a 10 month price index of 0.37975. 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 0.36900, the 24 month is 0.30000, and the 36 month is 0.28571. Narrowing in a bit closer, the 5 month price index is 0.70588, the 3 month is 0.90909, and the 1 month is currently 1.00000.

The Value Composite One (VC1) is a method that investors use to determine a company’s value.  The Value Composite score of Polar Power, Inc. (NasdaqCM:POLA) is 37.  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 Polar Power, Inc. (NasdaqCM:POLA) is 40.

Technicals

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In taking a look at some other notable technicals, Polar Power, Inc. (NasdaqCM:POLA)’s ROIC is 0.604169. The ROIC 5 year average is and the ROIC Quality ratio is . 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.

We also note that Polar Power, Inc. (NasdaqCM:POLA) has a Shareholder Yield of 0.000000 and a Shareholder Yield (Mebane Faber) of . The first value is calculated by adding the dividend yield to the percentage of repurchased shares. The second value adds in the net debt repaid yield to the calculation. Shareholder yield has the ability to show how much money the firm is giving back to shareholders via a few different avenues. Companies may issue new shares and buy back their own shares. This may occur at the same time. Investors may also use shareholder yield to gauge a baseline rate of return.

Polar Power, Inc. (NasdaqCM:POLA) has a current MF Rank of 313. Developed by hedge fund manager Joel Greenblatt, the intention of the formula is to spot high quality companies that are trading at an attractive price. The formula uses ROIC and earnings yield ratios to find quality, undervalued stocks. In general, companies with the lowest combined rank may be the higher quality picks.

We can now take a quick look at some historical stock price index data. Polar Power, Inc. (NasdaqCM:POLA) presently has a 10 month price index of 0.58889. 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 0.58889, the 24 month is 0.58889, and the 36 month is 0.58889. Narrowing in a bit closer, the 5 month price index is 1.02515, the 3 month is 0.97070, and the 1 month is currently 1.18040.

The C-Score is a system developed by James Montier that helps determine whether a company is involved in falsifying their financial statements.  The C-Score is calculated by a variety of items, including a growing difference in net income verse cash flow, increasing days outstanding, growing days sales of inventory, increasing assets to sales, declines in depreciation, and high total asset growth.  The C-Score of Polar Power, Inc. (NasdaqCM:POLA) is 3.00000.  The score ranges on a scale of -1 to 6.  If the score is -1, then there is not enough information to determine the C-Score.  If the number is at zero (0) then there is no evidence of fraudulent book cooking, whereas a number of 6 indicates a high likelihood of fraudulent activity. The C-Score assists investors in assessing the likelihood of a company cheating in the books.

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