The ROIC Quality of Farmer Bros. Co. (NasdaqGS:FARM) is 4.045952.  This is calculated by dividing the five year average ROIC by the Standard Deviation of the 5 year ROIC.  The ROIC 5 year average is calculated using the five year average EBIT, five year average (net working capital and net fixed assets). The ROIC is calculated by dividing the net operating profit (or EBIT) by the employed capital.  The employed capital is calculated by subrating current liabilities from total assets.  The Return on Invested Capital is a ratio that determines whether a company is profitable or not.  It tells investors how well a company is turning their capital into profits.  

Successful investors are typically well aware of portfolio holdings at any given time. They tend to regularly review the portfolio to make sure that the combination of stocks is in line with goals and contributing to the outlined strategy. There may be times when everything seems to be in order after a thorough portfolio review. Other times, there may be a few changes that can be made. Maybe there are one or two names that have been over performing providing a big boost to the portfolio. On the other end, there could be a few stocks that are impacting the portfolio in a negative way and they may need to be addressed. Although constant portfolio monitoring may not be overly necessary for longer-term investors, regular portfolio examination is generally considered to be a good idea.

Some of the best financial predictions are formed by using a variety of financial tools. The Price Range 52 Weeks is one of the tools that investors use to determine the lowest and highest price at which a stock has traded in the previous 52 weeks. The Price Range of Farmer Bros. Co. (NasdaqGS:FARM) over the past 52 weeks is 0.504000. The 52-week range can be found in the stock’s quote summary.

Farmer Bros. Co. (NasdaqGS:FARM) presently has a current ratio of 1.66. The current ratio, also known as the working capital ratio, is a liquidity ratio that displays the proportion of current assets of a business relative to the current liabilities. The ratio is simply calculated by dividing current liabilities by current assets. The ratio may be used to provide an idea of the ability of a certain company to pay back its liabilities with assets. Typically, the higher the current ratio the better, as the company may be more capable of paying back its obligations.

Farmer Bros. Co. (NasdaqGS:FARM)’s Leverage Ratio was recently noted as 0.204488. This ratio is calculated by dividing total debt by total assets plus total assets previous year, divided by two. The leverage of a company is relative to the amount of debt on the balance sheet. This ratio is often viewed as one measure of the financial health of a firm.

The price to book ratio or market to book ratio for Farmer Bros. Co. (NasdaqGS:FARM) currently stands at 1.407796.  The ratio is calculated by dividing the stock price per share by the book value per share.  This ratio is used to determine how the market values the equity.  A ratio of under 1 typically indicates that the shares are undervalued.  A ratio over 1 indicates that the market is willing to pay more for the shares.  There are often many underlying factors that come into play with the Price to Book ratio so all additional metrics should be considered as well. 

FCF
Free Cash Flow Growth (FCF Growth) is the free cash flow of the current year minus the free cash flow from the previous year, divided by last year’s free cash flow.  The FCF Growth of Farmer Bros. Co. (NasdaqGS:FARM) is 1.015714.  Free cash flow (FCF) is the cash produced by the company minus capital expenditure.  This cash is what a company uses to meet its financial obligations, such as making payments on debt or to pay out dividends.  The Free Cash Flow Score (FCF Score) is a helpful tool in calculating the free cash flow growth with free cash flow stability – this gives investors the overall quality of the free cash flow.  The FCF Score of Farmer Bros. Co. (NasdaqGS:FARM) is 1.572267.  Experts say the higher the value, the better, as it means that the free cash flow is high, or the variability of free cash flow is low or both.

GM Score
The Gross Margin Score is calculated by looking at the Gross Margin and the overall stability of the company over the course of 8 years.  The score is a number between one and one hundred (1 being best and 100 being the worst).  The Gross Margin Score of Farmer Bros. Co. (NasdaqGS:FARM) is 40.00000.  The more stable the company, the lower the score.  If a company is less stable over the course of time, they will have a higher score.

FCF
Free Cash Flow Growth (FCF Growth) is the free cash flow of the current year minus the free cash flow from the previous year, divided by last year’s free cash flow.  The FCF Growth of Farmer Bros. Co. (NasdaqGS:FARM) is 1.015714.  Free cash flow (FCF) is the cash produced by the company minus capital expenditure.  This cash is what a company uses to meet its financial obligations, such as making payments on debt or to pay out dividends.  The Free Cash Flow Score (FCF Score) is a helpful tool in calculating the free cash flow growth with free cash flow stability – this gives investors the overall quality of the free cash flow.  The FCF Score of Farmer Bros. Co. (NasdaqGS:FARM) is 1.572267.  Experts say the higher the value, the better, as it means that the free cash flow is high, or the variability of free cash flow is low or both.

Rank

The ERP5 Rank is an investment tool that analysts use to discover undervalued companies.  The ERP5 looks at the Price to Book ratio, Earnings Yield, ROIC and 5 year average ROIC.  The ERP5 of Farmer Bros. Co. (NasdaqGS:FARM) is 12101.  The lower the ERP5 rank, the more undervalued a company is thought to be.

Value
The Value Composite One (VC1) is a method that investors use to determine a company’s value.  The VC1 of Farmer Bros. Co. (NasdaqGS:FARM) is 38.  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 Farmer Bros. Co. (NasdaqGS:FARM) is 48.

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.  

Volatility

Stock volatility is a percentage that indicates whether a stock is a desirable purchase.  Investors look at the Volatility 12m to determine if a company has a low volatility percentage or not over the course of a year.  The Volatility 12m of Farmer Bros. Co. (NasdaqGS:FARM) is 35.858600.  This is calculated by taking weekly log normal returns and standard deviation of the share price over one year annualized.  The lower the number, a company is thought to have low volatility.  The Volatility 3m is a similar percentage determined by the daily log normal returns and standard deviation of the share price over 3 months.  The Volatility 3m of Farmer Bros. Co. (NasdaqGS:FARM) is 62.706400.  The Volatility 6m is the same, except measured over the course of six months.  The Volatility 6m is 53.401400.

When watching the day to day movements of the market, investors often have to be careful not to let external factors cloud their judgment. From time to time, there may be certain stocks taking off that look highly tempting to purchase. Getting into a position based on short-term price movements may be a specific strategy for some, but it may be highly costly for others. Even if a stock has been on a big run that the investor might have missed out on, there is no guarantee that the run will continue higher. Although there may be potential in highly publicized stocks, it may be wise for investors to do their own research and then decide if the stock fits with the overall goals.