Essex Property Debt
| ESS Stock | USD 304.34 3.75 1.25% |
Essex Property Trust holds a debt-to-equity ratio of 1.054. At this time, Essex Property's Short and Long Term Debt Total is comparatively stable compared to the past year. Debt To Equity is likely to gain to 1.53 in 2024, whereas Short Term Debt is likely to drop slightly above 358.1 M in 2024. . Essex Property's financial risk is the risk to Essex Property stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Essex Property'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. Essex Property'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 Essex Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Essex Property's stakeholders.
Essex Property Quarterly Net Debt |
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For most companies, including Essex Property, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Essex Property Trust, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Essex Property'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 3.5552 | Book Value 84.55 | Operating Margin 0.3038 | Profit Margin 0.3135 | Return On Assets 0.0268 |
Given that Essex Property'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 Essex Property 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 Essex Property to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Essex Property is said to be less leveraged. If creditors hold a majority of Essex Property's assets, the Company is said to be highly leveraged.
At this time, Essex Property's Liabilities And Stockholders Equity is comparatively stable compared to the past year. Non Current Liabilities Other is likely to gain to about 145.8 M in 2024, whereas Total Current Liabilities is likely to drop slightly above 213.4 M in 2024. Essex |
Essex Property Trust Debt to Cash Allocation
Many companies such as Essex Property, 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.
Essex Property Trust has 6.27 B in debt with debt to equity (D/E) ratio of 1.05, which is OK given its current industry classification. Essex Property Trust has a current ratio of 4.02, demonstrating that it is liquid and is capable to disburse its financial commitments when the payables are due. Note however, debt could still be an excellent tool for Essex to invest in growth at high rates of return. Essex Property Total Assets Over Time
Essex Property Assets Financed by Debt
The debt-to-assets ratio shows the degree to which Essex Property 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.Essex Property Debt Ratio | 42.0 |
Essex Property Corporate Bonds Issued
Essex Short Long Term Debt Total
Short Long Term Debt Total |
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Understaning Essex Property Use of Financial Leverage
Essex Property's financial leverage ratio measures its total debt position, including all of its outstanding liabilities, and compares it to Essex Property's current equity. If creditors own a majority of Essex Property's assets, the company is considered highly leveraged. Understanding the composition and structure of Essex Property's outstanding bonds gives an idea of how risky it is and if it is worth investing in.
| Last Reported | Projected for Next Year | ||
| Short and Long Term Debt Total | 6.3 B | 6.6 B | |
| Net Debt | 5.9 B | 2.9 B | |
| Short Term Debt | 701.5 M | 358.1 M | |
| Long Term Debt | 6.2 B | 3.6 B | |
| Long Term Debt Total | 6.9 B | 5.4 B | |
| Short and Long Term Debt | 59.9 M | 56.9 M | |
| Net Debt To EBITDA | 5.18 | 5.16 | |
| Debt To Equity | 1.20 | 1.53 | |
| Interest Debt Per Share | 104.54 | 52.99 | |
| Debt To Assets | 0.53 | 0.42 | |
| Long Term Debt To Capitalization | 0.52 | 0.59 | |
| Total Debt To Capitalization | 0.55 | 0.61 | |
| Debt Equity Ratio | 1.20 | 1.53 | |
| Debt Ratio | 0.53 | 0.42 | |
| Cash Flow To Debt Ratio | 0.15 | 0.10 |
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Additional Tools for Essex Stock Analysis
When running Essex Property's price analysis, check to measure Essex Property'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 Essex Property is operating at the current time. Most of Essex Property's value examination focuses on studying past and present price action to predict the probability of Essex Property's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Essex Property's price. Additionally, you may evaluate how the addition of Essex Property 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.