Graphjet Technology Current Debt
| GTI Stock | 2.69 0.01 0.37% |
Graphjet Technology holds a debt-to-equity ratio of 0.57. As of now, Graphjet Technology's Debt To Assets are increasing as compared to previous years. The Graphjet Technology's current Total Debt To Capitalization is estimated to increase to 0.16, while Short and Long Term Debt Total is projected to decrease to under 959 K. With a high degree of financial leverage come high-interest payments, which usually reduce Graphjet Technology's Earnings Per Share (EPS).
Asset vs Debt
Equity vs Debt
Graphjet Technology'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. Graphjet Technology'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 Graphjet Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Graphjet Technology's stakeholders.
Graphjet Technology Quarterly Net Debt |
|
For most companies, including Graphjet Technology, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Graphjet Technology, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Graphjet Technology's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Book Value (0.05) | Return On Assets (1.38) |
Given that Graphjet Technology'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 Graphjet Technology 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 Graphjet Technology to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Graphjet Technology is said to be less leveraged. If creditors hold a majority of Graphjet Technology's assets, the Company is said to be highly leveraged.
The Graphjet Technology's current Total Current Liabilities is estimated to increase to about 3.3 M, while Liabilities And Stockholders Equity is projected to decrease to under 12.4 M. Graphjet |
Graphjet Technology Financial Rating
Graphjet Technology financial ratings play a critical role in determining how much Graphjet Technology have to pay to access credit markets, i.e., the amount of interest on their issued debt. The threshold between investment-grade and speculative-grade ratings has important market implications for Graphjet Technology's borrowing costs.| Piotroski F Score | 2 | Frail | View |
| Beneish M Score | (5.48) | Unlikely Manipulator | View |
Graphjet Technology Debt to Cash Allocation
As Graphjet Technology follows its natural business cycle, the capital allocation decisions will not magically go away. Graphjet Technology's 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.
Graphjet Technology has 1.48 M in debt with debt to equity (D/E) ratio of 0.57, which is OK given its current industry classification. Graphjet Technology has a current ratio of 1.73, which is typical for the industry and considered as normal. Note however, debt could still be an excellent tool for Graphjet to invest in growth at high rates of return. Graphjet Technology Total Assets Over Time
Graphjet Technology Assets Financed by Debt
The debt-to-assets ratio shows the degree to which Graphjet Technology 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.Graphjet Technology Debt Ratio | 10.0 |
Graphjet Net Debt
Net Debt |
|
Understaning Graphjet Technology Use of Financial Leverage
Understanding the composition and structure of Graphjet Technology'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 Graphjet Technology'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 Reported | Projected for Next Year | ||
| Net Debt | 1.7 M | 1.8 M | |
| Short and Long Term Debt Total | 1.7 M | 959 K | |
| Short and Long Term Debt | 438.2 K | 389.5 K | |
| Short Term Debt | 1.7 M | 959 K | |
| Net Debt To EBITDA | (1.88) | (1.79) | |
| Debt To Equity | 0.18 | 0.19 | |
| Interest Debt Per Share | 0.28 | 0.29 | |
| Debt To Assets | 0.10 | 0.10 | |
| Total Debt To Capitalization | 0.15 | 0.16 | |
| Debt Equity Ratio | 0.18 | 0.19 | |
| Debt Ratio | 0.10 | 0.10 | |
| Cash Flow To Debt Ratio | (0.24) | (0.25) |
Currently Active Assets on Macroaxis
When determining whether Graphjet Technology offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Graphjet Technology'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 Graphjet Technology Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Graphjet Technology Stock:Check out the analysis of Graphjet Technology Fundamentals Over Time. For more detail on how to invest in Graphjet Stock please use our How to Invest in Graphjet Technology guide.You can also try the Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Is Electrical Components & Equipment 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 Graphjet Technology. If investors know Graphjet 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 Graphjet Technology listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Earnings Share (0.01) | Return On Assets (1.38) |
The market value of Graphjet Technology is measured differently than its book value, which is the value of Graphjet that is recorded on the company's balance sheet. Investors also form their own opinion of Graphjet Technology's value that differs from its market value or its book value, called intrinsic value, which is Graphjet Technology'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 Graphjet Technology's market value can be influenced by many factors that don't directly affect Graphjet Technology'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 Graphjet Technology's value and its price as these two are different measures arrived at by different means. Investors typically determine if Graphjet Technology is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Graphjet Technology'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.