Camber Energy 404280DR7 Bond

CEI Stock  USD 0.02  0  7.57%   
Camber Energy has over 48.27 Million in debt which may indicate that it relies heavily on debt financing. As of now, Camber Energy's Long Term Debt To Capitalization is increasing as compared to previous years. The Camber Energy's current Total Debt To Capitalization is estimated to increase to 1.24, while Short and Long Term Debt Total is projected to decrease to under 25.1 M. With a high degree of financial leverage come high-interest payments, which usually reduce Camber Energy's Earnings Per Share (EPS).

Asset vs Debt

Equity vs Debt

Camber Energy's liquidity is one of the most fundamental aspects of both its future profitability and its ability to meet different types of ongoing financial obligations. Camber Energy's cash, liquid assets, total liabilities, and shareholder equity can be utilized to evaluate how much leverage the Company is using to sustain its current operations. For traders, higher-leverage indicators usually imply a higher risk to shareholders. In addition, it helps Camber Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Camber Energy's stakeholders.
For most companies, including Camber Energy, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Camber Energy, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Camber Energy's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Price Book
2.042
Book Value
0.07
Operating Margin
(0.24)
Profit Margin
(1.73)
Return On Assets
(0.06)
As of now, Camber Energy's Liabilities And Stockholders Equity is increasing as compared to previous years. The Camber Energy's current Non Current Liabilities Total is estimated to increase to about 47.9 M, while Total Current Liabilities is projected to decrease to under 17.4 M.
  
Check out the analysis of Camber Energy Fundamentals Over Time.
For more detail on how to invest in Camber Stock please use our How to Invest in Camber Energy guide.
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Given the importance of Camber Energy's capital structure, the first step in the capital decision process is for the management of Camber Energy 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 Camber Energy to issue bonds at a reasonable cost.
Popular NameCamber Energy HSBC Holdings PLC
SpecializationSpecialty Industrial Machinery
Equity ISIN CodeUS13200M5085
Bond Issue ISIN CodeUS404280DR76
S&P Rating
Others
Maturity Date3rd of November 2028
Issuance Date3rd of November 2022
Coupon7.39 %
View All Camber Energy Outstanding Bonds

Camber Energy Outstanding Bond Obligations

Understaning Camber Energy Use of Financial Leverage

Understanding the composition and structure of Camber Energy's 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 Camber Energy's 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 ReportedProjected for Next Year
Net Debt47.4 M49.7 M
Short and Long Term Debt Total48.3 M25.1 M
Short Term Debt5.1 M9.3 M
Long Term Debt40.6 M25.1 M
Short and Long Term Debt3.8 M3.6 M
Net Debt To EBITDA(13.53)(12.85)
Debt To Equity 3.15  3.31 
Interest Debt Per Share 0.68  0.65 
Debt To Assets 0.45  0.43 
Long Term Debt To Capitalization 0.74  0.77 
Total Debt To Capitalization 0.76  1.24 
Debt Equity Ratio 3.15  3.31 
Debt Ratio 0.45  0.43 
Cash Flow To Debt Ratio(0.12)(0.12)
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When determining whether Camber Energy offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Camber Energy's 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 Camber Energy Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Camber Energy Stock:
Check out the analysis of Camber Energy Fundamentals Over Time.
For more detail on how to invest in Camber Stock please use our How to Invest in Camber Energy guide.
You can also try the Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Is Oil & Gas Exploration & Production 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 Camber Energy. If investors know Camber 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 Camber Energy listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.99)
Earnings Share
(0.62)
Revenue Per Share
0.348
Quarterly Revenue Growth
0.145
Return On Assets
(0.06)
The market value of Camber Energy is measured differently than its book value, which is the value of Camber that is recorded on the company's balance sheet. Investors also form their own opinion of Camber Energy's value that differs from its market value or its book value, called intrinsic value, which is Camber Energy's 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 Camber Energy's market value can be influenced by many factors that don't directly affect Camber Energy's 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 Camber Energy's value and its price as these two are different measures arrived at by different means. Investors typically determine if Camber Energy is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Camber Energy's 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.
By borrowing funds, the firm incurs a debt that must be paid. But, this debt is paid in small installments over a relatively long period of time. This frees funds for more immediate use in the stock market. For example, suppose a company can afford a new factory but will be left with negligible free cash. In that case, it may be better to finance the factory and spend the cash on hand on inputs, labor, or even hold a significant portion as a reserve against unforeseen circumstances.

The Risk of Financial Leverage

The most obvious and apparent risk of leverage is that if price changes unexpectedly, the leveraged position can lead to severe losses. For example, imagine a hedge fund seeded by $50 worth of investor money. The hedge fund borrows another $50 and buys an asset worth $100, leading to a leverage ratio of 2:1. For the investor, this is neither good nor bad -- until the asset price changes. If the asset price goes up 10 percent, the investor earns $10 on $50 of capital, a net gain of 20 percent, and is very pleased with the increased gains from the leverage. However, if the asset price crashes unexpectedly, say by 30 percent, the investor loses $30 on $50 of capital, suffering a 60 percent loss. In other words, the effect of leverage is to increase the volatility of returns and increase the effects of a price change on the asset to the bottom line while increasing the chance for profit as well.