Reliance Global Debt
| RELI Stock | USD 1.60 0.31 24.03% |
Reliance Global Group holds a debt-to-equity ratio of 0.6. As of now, Reliance Global's Debt Ratio is decreasing as compared to previous years. With a high degree of financial leverage come high-interest payments, which usually reduce Reliance Global's Earnings Per Share (EPS).
Asset vs Debt
Equity vs Debt
Reliance Global'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. Reliance Global'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 Reliance Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Reliance Global's stakeholders.
For most companies, including Reliance Global, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Reliance Global Group, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Reliance Global'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 0.7832 | Book Value 1.942 | Operating Margin (0.15) | Profit Margin (1.19) | Return On Assets (0.11) |
Given that Reliance Global'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 Reliance Global 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 Reliance Global to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Reliance Global is said to be less leveraged. If creditors hold a majority of Reliance Global's assets, the Company is said to be highly leveraged.
The Reliance Global's current Non Current Liabilities Other is estimated to increase to about 901.1 K, while Total Current Liabilities is projected to decrease to under 3 M. Reliance |
Reliance Global Bond Ratings
Reliance Global Group financial ratings play a critical role in determining how much Reliance Global 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 Reliance Global's borrowing costs.| Piotroski F Score | 4 | Poor | View |
| Beneish M Score | (6.49) | Unlikely Manipulator | View |
Reliance Global Group Debt to Cash Allocation
As Reliance Global Group follows its natural business cycle, the capital allocation decisions will not magically go away. Reliance Global'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.
Reliance Global Group currently holds 14.54 M in liabilities with Debt to Equity (D/E) ratio of 0.6, which is about average as compared to similar companies. Reliance Global Group has a current ratio of 0.55, indicating that it has a negative working capital and may not be able to pay financial obligations when due. Note, when we think about Reliance Global's use of debt, we should always consider it together with its cash and equity.Reliance Global Total Assets Over Time
Reliance Global Assets Financed by Debt
The debt-to-assets ratio shows the degree to which Reliance Global 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.Reliance Global Debt Ratio | 73.0 |
Reliance Global Corporate Bonds Issued
Most Reliance bonds can be classified according to their maturity, which is the date when Reliance Global Group has to pay back the principal to investors. Maturities can be short-term, medium-term, or long-term (more than ten years). Longer-term bonds usually offer higher interest rates but may entail additional risks.
Reliance Net Debt
Net Debt |
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Understaning Reliance Global Use of Financial Leverage
Understanding the composition and structure of Reliance Global'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 Reliance Global'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 | 13.2 M | 6.8 M | |
| Long Term Debt | 11.9 M | 6.1 M | |
| Long Term Debt Total | 9.1 M | 9.5 M | |
| Short and Long Term Debt | 1.8 M | 1.7 M | |
| Short Term Debt | 2.2 M | 1.9 M | |
| Short and Long Term Debt Total | 14.5 M | 12.4 M | |
| Net Debt To EBITDA | (1.48) | (1.55) | |
| Debt To Equity | 1.93 | 1.84 | |
| Interest Debt Per Share | 5.49 | 5.22 | |
| Debt To Assets | 0.60 | 0.73 | |
| Long Term Debt To Capitalization | 0.63 | 0.68 | |
| Total Debt To Capitalization | 0.66 | 0.42 | |
| Debt Equity Ratio | 1.93 | 1.84 | |
| Debt Ratio | 0.60 | 0.73 | |
| Cash Flow To Debt Ratio | (0.06) | (0.06) |
Currently Active Assets on Macroaxis
When determining whether Reliance Global Group is a strong investment it is important to analyze Reliance Global's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Reliance Global's future performance. For an informed investment choice regarding Reliance Stock, refer to the following important reports:Check out the analysis of Reliance Global Fundamentals Over Time. You can also try the FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Is Property & Casualty Insurance 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 Reliance Global. If investors know Reliance 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 Reliance Global listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Earnings Share (78.45) | Revenue Per Share 23.34 | Quarterly Revenue Growth 0.051 | Return On Assets (0.11) | Return On Equity (1.99) |
The market value of Reliance Global Group is measured differently than its book value, which is the value of Reliance that is recorded on the company's balance sheet. Investors also form their own opinion of Reliance Global's value that differs from its market value or its book value, called intrinsic value, which is Reliance Global'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 Reliance Global's market value can be influenced by many factors that don't directly affect Reliance Global'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 Reliance Global's value and its price as these two are different measures arrived at by different means. Investors typically determine if Reliance Global is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Reliance Global'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.