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Quantum Corporation Soars on Amazon’s Quantum Initiative: Is Timing Right for Investors?

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Written by Matt Monaco Reviewed by Jack Kellogg Fact-checked by Tim Sykes
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Quantum Corporation’s remarkable stock surge can be attributed to a revolutionary new partnership with a pioneering tech leader, positioning the company at the forefront of quantum computing innovations. On Wednesday, Quantum Corporation’s stocks have been trading up by 127.78 percent.

Highlights of Recent Developments:

  • Shares of QMCO surged significantly following Amazon’s Quantum Embark Program launch, as the market reacted favorably to this big step forward in quantum computing.
  • With the DXi9200, Quantum Corporation aims to enhance data protection, offering large firms robust backup and recovery options to counter ransomware risks.
  • Quantum introduced the Scalar i7 RAPTOR, their latest tape storage solution, aiming to address growing enterprise data management needs.

Candlestick Chart

Live Update At 17:20:13 EST: On Wednesday, December 18, 2024 Quantum Corporation stock [NASDAQ: QMCO] is trending up by 127.78%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

Quick Overview of Quantum Corporation’s Financial Metrics:

In the fast-paced world of trading, making the right moves can be challenging. It requires not only skill but also a strategic mindset. As millionaire penny stock trader and teacher Tim Sykes says, “Cut losses quickly, let profits ride, and don’t overtrade.” This mantra is crucial because it emphasizes the importance of minimizing losses while maximizing gains. Being disciplined and avoiding the temptation to trade excessively helps in maintaining a balanced and profitable trading strategy.

For Quantum Corporation, recent financial data disclose intriguing insights. The company recorded a notable revenue figure of over $311.6M, yet faces challenging profitability margins. The gross margin sits at 39.4%, despite the ebitmargin being troublingly negative at -21.5%. This paints a complex picture, showing a company with substantial revenues but also with areas requiring improvement. The company’s enterprise value hovers around $232.2M, highlighting significant market capitalization relative to its revenue stream.

The firm’s assets turnover ratio is 1.6, which indicates how well the company utilizes its assets to generate revenue. This, combined with a current ratio of 0.8, suggests liquidity challenges, as this ratio indicates the company’s ability to cover short-term obligations. Meanwhile, Quantum’s income statement shows a total revenue of $70.47M for the latest quarter, and it wrestles with total expenses that reach up to $77.4M, reflecting on profitability struggles with a net loss of $13.53M.

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This balance sheet confirms a total asset value of about $163.1M, with liabilities summing up to a demanding $316.5M. Despite these hurdles, the advancements with DXi9200 and Amazon collaboration could potentially signify future profitability for investors.

Impact and Implications of Recent News:

Amazon’s Quantum Embark Program:

Amazon’s bold initiative in quantum computing has stirred market dynamics, deeply influencing Quantum Corporation’s stock performance. The program promises to enhance research and industry advancements, setting a foundation for stronger future growth. With Amazon’s involvement, QMCO witnessed an exuberant trading session, with investors responding positively, thus driving a significant price upswing.

DXi9200 Launch:

The unveiling of the DXi9200 by Quantum brings a powerful cybersecurity revival. This sophisticated backup solution focuses on data efficiency and recovery, portraying a firm determined to elevate their game against cyber threats, offering more than just backup—it’s a cypher in data resilience against looming ransomware threats.

Scalar i7 RAPTOR Introduction:

Quantum’s release of Scalar i7 RAPTOR has added a new layer to modern data storage solutions. It’s a strategic move to strengthen enterprise data management with advanced storage offerings. This development not only meets growing demands but also positions them within prominent business activities, which could influence the company’s bottom line positively in upcoming quarters.

Conclusion:

Summarizing, Quantum Corporation navigates through a dynamic phase, where cutting-edge technological advancements such as the Amazon partnership, alongside their innovative product launches, reshape its market landscape. While the company’s financial records hint at challenges, these new strides indicate a potential turnaround. For traders, timing is crucial—amidst evolving technological horizons and current financial complexities, deciding whether to hold or venture into QMCO stock will depend on analyzing ongoing market responses and weighing optimism against inherent risks. As millionaire penny stock trader and teacher Tim Sykes says, “Preparation plus patience leads to big profits.” This mindset is essential for those considering QMCO stock, as it emphasizes the importance of strategy and timing in the trading landscape.

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”