MV Oil Debt
| MVO Stock | USD 9.27 0.13 1.42% |
As of the 25th of November 2024, Long Term Debt is likely to drop to about 57.8 M. In addition to that, Net Debt is likely to grow to about (1.2 M) With a high degree of financial leverage come high-interest payments, which usually reduce MV Oil's Earnings Per Share (EPS).
Debt Ratio | First Reported 2010-12-31 | Previous Quarter 0.0 | Current Value 0.0 | Quarterly Volatility 0.0 |
MVO |
MV Oil Bond Ratings
MV Oil Trust financial ratings play a critical role in determining how much MV Oil 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 MV Oil's borrowing costs.| Piotroski F Score | 7 | Strong | View |
| Beneish M Score | (15,606) | Unlikely Manipulator | View |
MV Oil Trust Debt to Cash Allocation
As MV Oil Trust follows its natural business cycle, the capital allocation decisions will not magically go away. MV Oil'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.
Note however, debt could still be an excellent tool for MVO to invest in growth at high rates of return. MV Oil Total Assets Over Time
MV Oil 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 MV Oil's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of MV Oil, which in turn will lower the firm's financial flexibility.MV Oil Corporate Bonds Issued
MVO Long Term Debt
Long Term Debt |
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Understaning MV Oil Use of Financial Leverage
Leverage ratios show MV Oil's total debt position, including all outstanding obligations. In simple terms, high financial leverage means that the cost of production, along with the day-to-day running of the business, is high. Conversely, lower financial leverage implies lower fixed cost investment in the business, which is generally considered a good sign by investors. The degree of MV Oil's financial leverage can be measured in several ways, including ratios such as the debt-to-equity ratio (total debt / total equity), or the debt ratio (total debt / total assets).
| Last Reported | Projected for Next Year | ||
| Long Term Debt | 92 M | 57.8 M | |
| Net Debt | -1.3 M | -1.2 M | |
| Net Debt To EBITDA | (0.08) | (0.07) |
Check out the analysis of MV Oil Fundamentals Over Time. You can also try the Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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 MV Oil. If investors know MVO 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 MV Oil 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 0.134 | Earnings Share 1.59 | Revenue Per Share 1.604 | Quarterly Revenue Growth 0.072 | Return On Assets 1.8876 |
The market value of MV Oil Trust is measured differently than its book value, which is the value of MVO that is recorded on the company's balance sheet. Investors also form their own opinion of MV Oil's value that differs from its market value or its book value, called intrinsic value, which is MV Oil'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 MV Oil's market value can be influenced by many factors that don't directly affect MV Oil'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 MV Oil's value and its price as these two are different measures arrived at by different means. Investors typically determine if MV Oil is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, MV Oil'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.