Question 1: Is the average return for Masimo stock higher after a drop?
Consider two situations,
Case 1: Masimo stock drops by -5% or more in a week
Case 2: Masimo stock rises by 5% or more in a week
Is the average return for Masimo stock higher over the subsequent month after Case 1 or Case 2?
MASI stock fares better after Case 1, with an average return of 2% over the next month (21 trading days) under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an average return of 1.4% for Case 2.
In comparison, the S&P 500 has an average return of 3.1% over the next 21 trading days under Case 1, and an average return of just 0.5% for Case 2 as detailed in our dashboard that details the average return for the S&P 500 after a fall or rise.
Try the Trefis machine learning engine above to see for yourself how Masimo stock is likely to behave after any specific gain or loss over a period.
Question 2: Does patience pay?
If you buy and hold Masimo stock, the expectation is over time the near-term fluctuations will cancel out, and the long-term positive trend will favor you - at least if the company is otherwise strong.
Overall, according to data and Trefis machine learning engine's calculations, patience absolutely pays for most stocks!
For MASI stock, the returns over the next N days after a -5% change over the last 5 trading days is detailed in the table below, along with the returns for the S&P500:
Next N DaysMASI Average ReturnS&P 500 Average Return1 day0.2%0.5%5 days1.3%1.1%10 days2%0.9%21 days2%3.1%63 days6.6%5.2%126 days12%7.4%252 days31%15.6%
You can try the engine to see what this table looks like for Masimo after a larger loss over the last week, month, or quarter.
Question 3: What about the average return after a rise if you wait for a while?
The average return after a rise is understandably lower than after a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks - although MASI stock appears to be an exception to this general observation.
MASI's returns over the next N days after a 5% change over the last 5 trading days is detailed in the table below, along with the returns for the S&P500:
Next N DaysMASI Average ReturnS&P 500 Average Return1 day0%-0.3%5 days0.5%-0.3%10 days0.4%0.1%21 days1.4%0.5%63 days5.7%3.0%126 days11.7%6.6%252 days26.2%11.7%
It's pretty powerful to test the trend for yourself for Masimo stock by changing the inputs in the charts above.