Compagnie Debt
| CFEB Stock | EUR 6.09 0.09 1.50% |
Compagnie d Entreprises has over 53.17 Million in debt which may indicate that it relies heavily on debt financing. . Compagnie's financial risk is the risk to Compagnie stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Compagnie'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. Compagnie'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 Compagnie Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Compagnie's stakeholders.
For most companies, including Compagnie, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Compagnie d Entreprises, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Compagnie's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Given that Compagnie's debt-to-equity ratio measures a Company's obligations relative to the value of its net assets, it is usually used by traders to estimate the extent to which Compagnie is acquiring new debt as a mechanism of leveraging its assets. A high debt-to-equity ratio is generally associated with increased risk, implying that it has been aggressive in financing its growth with debt. Another way to look at debt-to-equity ratios is to compare the overall debt load of Compagnie to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Compagnie is said to be less leveraged. If creditors hold a majority of Compagnie's assets, the Company is said to be highly leveraged.
Compagnie |
Compagnie d Entreprises Debt to Cash Allocation
Many companies such as Compagnie, eventually find out that there is only so much market out there to be conquered, and adding the next product or service is only half as profitable per unit as their current endeavors. Eventually, the company will reach a point where cash flows are strong, and extra cash is available but not fully utilized. In this case, the company may start buying back its stock from the public or issue more dividends.
Compagnie d Entreprises has accumulated 53.17 M in total debt with debt to equity ratio (D/E) of 60.9, indicating the company may have difficulties to generate enough cash to satisfy its financial obligations. Compagnie d Entreprises has a current ratio of 0.79, indicating that it has a negative working capital and may not be able to pay financial obligations in time and when they become due. Debt can assist Compagnie until it has trouble settling it off, either with new capital or with free cash flow. So, Compagnie's shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Compagnie d Entreprises sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Compagnie to invest in growth at high rates of return. When we think about Compagnie's use of debt, we should always consider it together with cash and equity.Compagnie Assets Financed by Debt
Typically, companies with high debt-to-asset ratios are said to be highly leveraged. The higher the ratio, the greater risk will be associated with the Compagnie's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Compagnie, which in turn will lower the firm's financial flexibility.Compagnie Corporate Bonds Issued
Understaning Compagnie Use of Financial Leverage
Compagnie's financial leverage ratio measures its total debt position, including all of its outstanding liabilities, and compares it to Compagnie's current equity. If creditors own a majority of Compagnie's assets, the company is considered highly leveraged. Understanding the composition and structure of Compagnie's outstanding bonds gives an idea of how risky it is and if it is worth investing in.
Compagnie dEntreprises CFE SA operates in dredging, environment and marine engineering, contracting, and real estate sectors. Compagnie dEntreprises CFE SA is a subsidiary of Ackermans van Haaren NV. Compagnie dEntreprises operates under Construction - Industrial And Diversified classification in Belgium and is traded on Brussels Stock Exchange. It employs 8598 people. Please read more on our technical analysis page.
Pair Trading with Compagnie
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Compagnie position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Compagnie will appreciate offsetting losses from the drop in the long position's value.Moving together with Compagnie Stock
Moving against Compagnie Stock
The ability to find closely correlated positions to Compagnie could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Compagnie when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Compagnie - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Compagnie d Entreprises to buy it.
The correlation of Compagnie is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Compagnie moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Compagnie d Entreprises moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Compagnie can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Additional Tools for Compagnie Stock Analysis
When running Compagnie's price analysis, check to measure Compagnie's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Compagnie is operating at the current time. Most of Compagnie's value examination focuses on studying past and present price action to predict the probability of Compagnie's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Compagnie's price. Additionally, you may evaluate how the addition of Compagnie to your portfolios can decrease your overall portfolio volatility.
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.