PAPA JOHNS INTERNATIONAL INC

46.06 +1.23 (+2.67%) Sell

PZZA does a dead cat bounce, it's still too early to buy into it

13 min read

PAPA JOHNS INTERNATIONAL INC was among the best performers on Thursday. It returned +2.67% to close at 46.06. It is currently trading -32% below it's 52 week high of 68.62.

[Themes containing PZZA]

PZZA is currently in a down trend. The current bearish signal has generated a profit of +6.31% for investors in the last three months.

Trend

PZZA has been underperforming the SP500 index in recent time, after having outperformed till 30 Nov, 2016. Over the last 2 years 11 months and 9 days, PZZA underperformed the SP500 index on 52% days.

During the last three months PZZA delivered losses on 56% days. However, it still managed to end this period in a profit. It's best return during this period (of +9.8%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -10.23%) was on Tuesday, 27 Nov, 2018. There was initially a bullish trend during this period which started on 30 Oct, 2018 and went on till 2 Nov, 2018. The bullish trend returned +12.17% to investors. This was followed by a bearish trend that started on 30 Nov, 2018 and ended on 10 Dec, 2018. This bearish trend lost -9.04% of investor capital.

PZZA had 5 profitable and 7 loss making months over the last year. During the last year, PZZA underperformed SP500 index on monthly return basis. PZZA was also a more risky investment than SP500 index as it's worst month in the last year, May 2018, returned -17.18% compared to -7.28% returned by SP500 index in Oct 2018. PZZA had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year. It is interesting to note that both PZZA and SP500 index significantly outperform during months when quarterly/annual results are announced.

Many folks think they aren't good at earning money, when what they don't know is how to use it.
-- Frank A. Clark

PZZA is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in PZZA's volatility from 19 Sep, 2018 to 28 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 14 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that PZZA has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

Investors trading in PZZA derivatives at this moment can consider 'Covered Call' options strategy to receive better risk-adjusted returns.

SP500 index has more chance of extreme outcomes than PZZA. Therefore, SP500 must receive a lower allocation than PZZA in your portfolio. SP500 index usually has shorter drawdown period than PZZA.

Based on your interest in PZZA you may find it interesting to know that HUBG, KWR and PSO have all performed similar to PZZA and qualify as alternative investment candidates that must be evaluated for diversification.

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