SBC Communications Current Debt
| SBC Stock | 7.27 0.52 6.68% |
As of November 28, 2024, Long Term Debt is expected to decline to about 10.2 M. In addition to that, Short and Long Term Debt is expected to decline to about 3.3 M With a high degree of financial leverage come high-interest payments, which usually reduce SBC Communications' Earnings Per Share (EPS).
As of November 28, 2024, Total Current Liabilities is expected to decline to about 77.5 M. In addition to that, Non Current Liabilities Total is expected to decline to about 21.4 MSBC |
SBC Communications Financial Rating
SBC Communications financial ratings play a critical role in determining how much SBC Communications 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 SBC Communications' borrowing costs.| Piotroski F Score | 3 | Frail | View |
| Beneish M Score | (3.27) | Unlikely Manipulator | View |
SBC Communications 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 SBC Communications' operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of SBC Communications, which in turn will lower the firm's financial flexibility.Understaning SBC Communications Use of Financial Leverage
SBC Communications' financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures SBC Communications' total debt position, including all outstanding debt obligations, and compares it with SBC Communications' equity. Financial leverage can amplify the potential profits to SBC Communications' owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if SBC Communications is unable to cover its debt costs.
| Last Reported | Projected for Next Year | ||
| Long Term Debt | 13 M | 10.2 M | |
| Short and Long Term Debt | 3.5 M | 3.3 M |
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Analyzing currently trending equities could be an opportunity to develop a better portfolio based on different market momentums that they can trigger. Utilizing the top trending stocks is also useful when creating a market-neutral strategy or pair trading technique involving a short or a long position in a currently trending equity.When determining whether SBC Communications offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of SBC Communications' 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 Sbc Communications Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Sbc Communications Stock:Check out the analysis of SBC Communications Fundamentals Over Time. For information on how to trade SBC Stock refer to our How to Trade SBC Stock guide.You can also try the Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Is Health Care Providers & Services 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 SBC Communications. If investors know SBC 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 SBC Communications listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of SBC Communications is measured differently than its book value, which is the value of SBC that is recorded on the company's balance sheet. Investors also form their own opinion of SBC Communications' value that differs from its market value or its book value, called intrinsic value, which is SBC Communications' 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 SBC Communications' market value can be influenced by many factors that don't directly affect SBC Communications' 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 SBC Communications' value and its price as these two are different measures arrived at by different means. Investors typically determine if SBC Communications is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, SBC Communications' 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.