Stonex Group 86184WAA4 Bond
| SNEX Stock | USD 102.45 0.03 0.03% |
Stonex Group has over 6.48 Billion in debt which may indicate that it relies heavily on debt financing. At this time, Stonex's Net Debt is fairly stable compared to the past year. Short and Long Term Debt Total is likely to rise to about 7.8 B in 2024, whereas Short and Long Term Debt is likely to drop slightly above 372.5 M in 2024. With a high degree of financial leverage come high-interest payments, which usually reduce Stonex's Earnings Per Share (EPS).
Asset vs Debt
Equity vs Debt
Stonex'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. Stonex'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 Stonex Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Stonex's stakeholders.
For most companies, including Stonex, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Stonex Group, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Stonex'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 1.9107 | Book Value 50.652 | Operating Margin 0.0034 | Profit Margin 0.0028 | Return On Assets 0.0098 |
Stonex |
Given the importance of Stonex's capital structure, the first step in the capital decision process is for the management of Stonex to decide how much external capital it will need to raise to operate in a sustainable way. Once the amount of financing is determined, management needs to examine the financial markets to determine the terms in which the company can boost capital. This move is crucial to the process because the market environment may reduce the ability of Stonex Group to issue bonds at a reasonable cost.
| Popular Name | Stonex US86184WAA45 |
| Specialization | Financial Services |
| Equity ISIN Code | US8618961085 |
| Bond Issue ISIN Code | US86184WAA45 |
| S&P Rating | Others |
| Maturity Date | 15th of May 2029 |
| Issuance Date | 11th of May 2021 |
| Coupon | 8.5 % |
Stonex Group Outstanding Bond Obligations
| US86184WAA45 | US86184WAA45 | Details |
Understaning Stonex Use of Financial Leverage
Understanding the structure of Stonex's debt obligations provides insight if it is worth investing in it. Financial leverage can amplify the potential profits to Stonex's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its cost of debt.
| Last Reported | Projected for Next Year | ||
| Net Debt | 6.2 B | 6.5 B | |
| Short and Long Term Debt Total | 7.4 B | 7.8 B | |
| Short Term Debt | 6.5 B | 6.9 B | |
| Long Term Debt | 6.9 B | 7.2 B | |
| Long Term Debt Total | 583 M | 612.2 M | |
| Short and Long Term Debt | 392.1 M | 372.5 M | |
| Net Debt To EBITDA | 3.95 | 2.34 | |
| Debt To Equity | 4.14 | 3.93 | |
| Interest Debt Per Share | 238.08 | 249.98 | |
| Debt To Assets | 0.26 | 0.34 | |
| Long Term Debt To Capitalization | 0.29 | 0.34 | |
| Total Debt To Capitalization | 0.74 | 0.50 | |
| Debt Equity Ratio | 4.14 | 3.93 | |
| Debt Ratio | 0.26 | 0.34 |
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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.Additional Tools for Stonex Stock Analysis
When running Stonex's price analysis, check to measure Stonex'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 Stonex is operating at the current time. Most of Stonex's value examination focuses on studying past and present price action to predict the probability of Stonex's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Stonex's price. Additionally, you may evaluate how the addition of Stonex 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.