BigBearai Holdings Corporate Bonds and Leverage Analysis
| BBAI Stock | USD 2.15 0.03 1.42% |
As of now, BigBearai Holdings' Short and Long Term Debt is increasing as compared to previous years. The BigBearai Holdings' current Short Term Debt is estimated to increase to about 3 M, while Net Debt is projected to decrease to under 126.9 M. With a high degree of financial leverage come high-interest payments, which usually reduce BigBearai Holdings' Earnings Per Share (EPS).
Debt Ratio | First Reported 2010-12-31 | Previous Quarter 0.98184683 | Current Value 0.59 | Quarterly Volatility 0.17489829 |
BigBearai |
Given the importance of BigBearai Holdings' capital structure, the first step in the capital decision process is for the management of BigBearai Holdings to decide how much external capital it will need to raise to operate in a sustainable way. Once the amount of financing is determined, management needs to examine the financial markets to determine the terms in which the company can boost capital. This move is crucial to the process because the market environment may reduce the ability of BigBearai Holdings to issue bonds at a reasonable cost.
BigBearai Holdings Debt to Cash Allocation
As BigBearai Holdings follows its natural business cycle, the capital allocation decisions will not magically go away. BigBearai Holdings' decision-makers have to determine if most of the cash flows will be poured back into or reinvested in the business, reserved for other projects beyond operational needs, or paid back to stakeholders and investors.
BigBearai Holdings currently holds 200.59 M in liabilities. BigBearai Holdings has a current ratio of 2.3, suggesting that it is liquid enough and is able to pay its financial obligations when due. Note, when we think about BigBearai Holdings' use of debt, we should always consider it together with its cash and equity.BigBearai Holdings Common Stock Shares Outstanding Over Time
BigBearai Holdings Assets Financed by Debt
The debt-to-assets ratio shows the degree to which BigBearai Holdings uses debt to finance its assets. It includes both long-term and short-term borrowings maturing within one year. It also includes both tangible and intangible assets, such as goodwill.BigBearai Holdings Debt Ratio | 59.0 |
BigBearai Holdings Corporate Bonds Issued
Most BigBearai bonds can be classified according to their maturity, which is the date when BigBearai Holdings has to pay back the principal to investors. Maturities can be short-term, medium-term, or long-term (more than ten years). Longer-term bonds usually offer higher interest rates but may entail additional risks.
BigBearai Net Debt
Net Debt |
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Understaning BigBearai Holdings Use of Financial Leverage
Understanding the composition and structure of BigBearai Holdings' debt gives an idea of how risky is the capital structure of the business and if it is worth investing in it. The degree of BigBearai Holdings' financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets).
| Last Reported | Projected for Next Year | ||
| Net Debt | 168 M | 126.9 M | |
| Short and Long Term Debt Total | 200.6 M | 193.2 M | |
| Long Term Debt | 194.3 M | 187.8 M | |
| Short and Long Term Debt | 1.2 M | 1.7 M | |
| Short Term Debt | 2 M | 3 M | |
| Long Term Debt Total | 173.1 M | 153.9 M | |
| Net Debt To EBITDA | (4.47) | (4.70) | |
| Debt To Equity | (2.91) | (3.06) | |
| Interest Debt Per Share | 1.41 | 0.95 | |
| Debt To Assets | 0.98 | 0.59 | |
| Long Term Debt To Capitalization | 1.53 | 0.78 | |
| Total Debt To Capitalization | 1.52 | 0.78 | |
| Debt Equity Ratio | (2.91) | (3.06) | |
| Debt Ratio | 0.98 | 0.59 | |
| Cash Flow To Debt Ratio | (0.09) | (0.10) |
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When determining whether BigBearai Holdings offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of BigBearai Holdings' financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Bigbearai Holdings Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Bigbearai Holdings Stock:Check out the analysis of BigBearai Holdings Fundamentals Over Time. For more detail on how to invest in BigBearai Stock please use our How to Invest in BigBearai Holdings guide.You can also try the Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Is Internet Services & Infrastructure space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of BigBearai Holdings. If investors know BigBearai will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about BigBearai Holdings listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Earnings Share (0.78) | Revenue Per Share 0.737 | Quarterly Revenue Growth 0.221 | Return On Assets (0.09) | Return On Equity (7.38) |
The market value of BigBearai Holdings is measured differently than its book value, which is the value of BigBearai that is recorded on the company's balance sheet. Investors also form their own opinion of BigBearai Holdings' value that differs from its market value or its book value, called intrinsic value, which is BigBearai Holdings' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because BigBearai Holdings' market value can be influenced by many factors that don't directly affect BigBearai Holdings' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between BigBearai Holdings' value and its price as these two are different measures arrived at by different means. Investors typically determine if BigBearai Holdings is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, BigBearai Holdings' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
What is Financial Leverage?
Financial leverage is the use of borrowed money (debt) to finance the purchase of assets with the expectation that the income or capital gain from the new asset will exceed the cost of borrowing. In most cases, the debt provider will limit how much risk it is ready to take and indicate a limit on the extent of the leverage it will allow. In the case of asset-backed lending, the financial provider uses the assets as collateral until the borrower repays the loan. In the case of a cash flow loan, the general creditworthiness of the company is used to back the loan. The concept of leverage is common in the business world. It is mostly used to boost the returns on equity capital of a company, especially when the business is unable to increase its operating efficiency and returns on total investment. Because earnings on borrowing are higher than the interest payable on debt, the company's total earnings will increase, ultimately boosting stockholders' profits.Leverage and Capital Costs
The debt to equity ratio plays a role in the working average cost of capital (WACC). The overall interest on debt represents the break-even point that must be obtained to profitability in a given venture. Thus, WACC is essentially the average interest an organization owes on the capital it has borrowed for leverage. Let's say equity represents 60% of borrowed capital, and debt is 40%. This results in a financial leverage calculation of 40/60, or 0.6667. The organization owes 10% on all equity and 5% on all debt. That means that the weighted average cost of capital is (.4)(5) + (.6)(10) - or 8%. For every $10,000 borrowed, this organization will owe $800 in interest. Profit must be higher than 8% on the project to offset the cost of interest and justify this leverage.Benefits of Financial Leverage
Leverage provides the following benefits for companies:- Leverage is an essential tool a company's management can use to make the best financing and investment decisions.
- It provides a variety of financing sources by which the firm can achieve its target earnings.
- Leverage is also an essential technique in investing as it helps companies set a threshold for the expansion of business operations. For example, it can be used to recommend restrictions on business expansion once the projected return on additional investment is lower than the cost of debt.