Repay debts – Loro Dinapoli http://lorodinapoli.org/ Tue, 17 May 2022 04:19:27 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 http://lorodinapoli.org/wp-content/uploads/2021/07/icon-2021-07-06T154208.998-150x150.png Repay debts – Loro Dinapoli http://lorodinapoli.org/ 32 32 Here’s why Wilson (OB:WILS) can manage his debt responsibly http://lorodinapoli.org/heres-why-wilson-obwils-can-manage-his-debt-responsibly/ Tue, 17 May 2022 04:11:25 +0000 http://lorodinapoli.org/heres-why-wilson-obwils-can-manage-his-debt-responsibly/ Howard Marks said it well when he said that, rather than worrying about stock price volatility, “the possibility of permanent loss is the risk I worry about…and that every practical investor that I know is worried”. When we think of a company’s risk, we always like to look at its use of debt, because over-indebtedness […]]]>

Howard Marks said it well when he said that, rather than worrying about stock price volatility, “the possibility of permanent loss is the risk I worry about…and that every practical investor that I know is worried”. When we think of a company’s risk, we always like to look at its use of debt, because over-indebtedness can lead to ruin. Above all, Wilson ASA (OB:WILS) is in debt. But the more important question is: what risk does this debt create?

When is debt dangerous?

Generally speaking, debt only becomes a real problem when a company cannot easily repay it, either by raising capital or with its own cash flow. Ultimately, if the company cannot meet its legal debt repayment obligations, shareholders could walk away with nothing. However, a more common (but still costly) situation is when a company has to dilute shareholders at a cheap share price just to keep debt under control. Of course, debt can be an important tool in businesses, especially capital-intensive businesses. The first thing to do when considering how much debt a business has is to look at its cash and debt together.

See our latest analysis for Wilson

What is Wilson’s debt?

You can click on the chart below for historical figures, but it shows Wilson had €114.9m in debt in March 2022, up from €130.5m a year earlier. However, he has €39.2m in cash which makes up for this, resulting in a net debt of around €75.8m.

OB:WILS Debt to Equity History May 17, 2022

A look at Wilson’s responsibilities

We can see from the most recent balance sheet that Wilson had liabilities of 82.3 million euros maturing in one year and liabilities of 149.5 million euros due beyond. In return for these bonds, it had cash of €39.2 million as well as receivables worth €33.4 million maturing in less than 12 months. Its liabilities therefore total €159.2 million more than the combination of its cash and short-term receivables.

Wilson has a market capitalization of 302.7 million euros, so he could very likely raise funds to improve his balance sheet, if the need arose. But it is clear that it must be carefully examined whether he can manage his debt without dilution.

In order to assess a company’s debt relative to its earnings, we calculate its net debt divided by its earnings before interest, taxes, depreciation and amortization (EBITDA) and its earnings before interest and taxes (EBIT) divided by its expenses. interest (its interest coverage). The advantage of this approach is that we consider both the absolute amount of debt (with net debt to EBITDA) and the actual interest expense associated with that debt (with its interest coverage ratio ).

Wilson has a low net debt to EBITDA ratio of just 0.77. And its EBIT covers its interest charges 14.8 times. One could therefore say that he is no more threatened by his debt than an elephant is by a mouse. Even more impressive is the fact that Wilson increased its EBIT by 221% year-over-year. This boost will make it even easier to pay off debt in the future. There is no doubt that we learn the most about debt from the balance sheet. But you can’t look at debt in total isolation; since Wilson will need income to repay that debt. So, when considering debt, it is definitely worth looking at the earnings trend. Click here for an interactive preview.

But our last consideration is also important, because a company cannot pay debt with paper profits; he needs cash. We therefore always check how much of this EBIT is converted into free cash flow. Fortunately for all shareholders, Wilson has actually produced more free cash flow than EBIT over the past three years. This kind of high cash conversion gets us as excited as the crowd when the beat drops at a Daft Punk concert.

Our point of view

The good news is that Wilson’s demonstrated ability to cover his interest costs with his EBIT thrills us like a fluffy pup does a toddler. But truth be told, we think his total passive level undermines that impression a bit. Zooming out, Wilson seems to be using debt quite sensibly; and that gets the green light from us. Although debt carries risks, when used wisely, it can also generate a higher return on equity. The balance sheet is clearly the area to focus on when analyzing debt. But at the end of the day, every business can contain risks that exist outside of the balance sheet. For example – Wilson has 2 warning signs we think you should know.

If you are interested in investing in companies that can generate profits without the burden of debt, then check out this free list of growing companies that have net cash on the balance sheet.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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4 Sneaky Ways to Lose Your Social Security Benefits http://lorodinapoli.org/4-sneaky-ways-to-lose-your-social-security-benefits/ Sun, 15 May 2022 12:00:00 +0000 http://lorodinapoli.org/4-sneaky-ways-to-lose-your-social-security-benefits/ Social Security benefits can potentially make or break the retirement of many older Americans. In fact, about 1 in 5 baby boomers say Social Security is their only source of retirement income, according to a 2020 National Retirement Institute survey. If you plan to rely on your benefits in any capacity in retirement, it’s wise […]]]>

Social Security benefits can potentially make or break the retirement of many older Americans. In fact, about 1 in 5 baby boomers say Social Security is their only source of retirement income, according to a 2020 National Retirement Institute survey.

If you plan to rely on your benefits in any capacity in retirement, it’s wise to make sure you receive as many of them as possible. And there are a few unexpected ways you can lose your perks without realizing it.

Image source: Getty Images.

1. Taxes

Your Social Security benefits may be subject to both federal and state retirement income tax. Whether or not you owe state taxes will depend on where you live, and the good news is that 38 states don’t tax Social Security at all.

Federal taxes will depend on a number called your “combined income,” which is your adjusted gross income plus half of your annual Social Security benefit amount. So, for example, if you withdraw $30,000 per year from your 401(k) and earn $20,000 per year in benefits, your combined income is $40,000 per year.

If your combined income is more than $25,000 per year (or $32,000 per year for married couples filing taxes jointly), you will have to pay federal taxes on a portion of your benefits.

2. Unpaid debts

In some cases, the Social Security Administration may withhold part of your benefits if you have certain types of unpaid debts.

These debts can include unpaid child support, alimony, or restitution. The Treasury Department can also garnish your benefits to cover unpaid tax debts, withholding up to 15% of your monthly checks until you pay off your debt.

3. Delaying benefits too long

In general, waiting to file a Social Security claim will result in a higher benefit amount. However, it is possible to delay too long, in which case you could miss the money owed to you.

You can apply for benefits at age 62 or any later age. By deferring Social Security until age 70, you will receive the highest amount of benefits. Delaying past age 70, however, won’t result in larger checks.

If you’re still working at age 70, it’s best to start claiming Social Security whether you’re ready to file or not. If you wait until after this age to file your return, you will simply miss the money to which you are entitled.

4. Earn too much

You can continue to work even after applying for benefits, but if you have not yet reached full retirement age (FRA), part of your payments may be withheld.

The amount of your benefits that will be withheld depends on your salary and your age. If you don’t reach your FRA in 2022, your Social Security will be reduced by $1 for every $2 you earn over the $19,560 per year limit. So, for example, if you earn $25,000 a year at your job, that’s $5,440 over the limit, so your benefits will be reduced by $2,720 a year.

If you reach your FRA this year, your earnings are subject to a different limit. In this case, your payments will be reduced by $1 for every $3 you earn above $51,960 per year.

Fortunately, these reductions are only temporary. Once you reach your FRA, the Social Security Administration will recalculate your benefit amount to account for any deductions. But even though you technically aren’t losing money, if you were relying on that monthly income in retirement, you might be surprised if you earn too much.

Making the Most of Social Security

Social security benefits are often an important source of income for retirees. By understanding as much as you can about how the program works, you can get every penny out of Social Security and enjoy a more financially comfortable retirement.

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Rising student debt will make money problems for young Britons worse http://lorodinapoli.org/rising-student-debt-will-make-money-problems-for-young-britons-worse/ Fri, 13 May 2022 03:24:20 +0000 http://lorodinapoli.org/rising-student-debt-will-make-money-problems-for-young-britons-worse/ London (AFP) – Rhiannon Muise graduated from Edge Hill University in the North West of England last year with a mountain of student debt, which is only growing due to soaring inflation. The 21-year-old dance and theater graduate said it would take her a ‘lifetime’ to repay the £45,000 ($55,000) she owes for tuition fees […]]]>

London (AFP) – Rhiannon Muise graduated from Edge Hill University in the North West of England last year with a mountain of student debt, which is only growing due to soaring inflation.

The 21-year-old dance and theater graduate said it would take her a ‘lifetime’ to repay the £45,000 ($55,000) she owes for tuition fees and living expenses, particularly if she remains in the field of his choice where wages may be low.

Muise’s plight echoes that of students across Britain, who are already grappling with a cost of living crisis.

Britons heading to university next year will face major changes that critics say will add to the financial pain.

Exhausting

The pressure is “exhausting, especially for someone in their twenties who has just started thinking about their career,” Muise told AFP.

His current job as a student engagement manager at Edge Hill pays below the threshold that activates reimbursements.

UK graduates carry more debt than any other developed country, according to data from the House of Commons Library.

Around 1.5million students borrow nearly £20billion every year in England alone.

And on average, 2020 graduates have racked up £45,000 in debt.

Zeno owes the government just under £75,000 for his student loans and says he’s resigned himself to paying them back for the next 30 years – unless he wins the lottery Daniel LEALAFP

Zeno, a 25-year-old student in London who only gave his first name, said he owed just under £75,000 for his loans.

Unless he “wins the lottery”, he accepts that he will probably pay his salary money back for the next 30 years.

Tuition

University was once free in the UK, with means-tested scholarships for poorer students to help cover living costs.

But after the sector opened up in the 1990s, the numbers rose and, despite protests from student associations, tuition fees were gradually introduced over the past decade to help universities meet costs.

University tuition fees vary by region in the UK, as education is a matter for the governments of Scotland, Wales and Northern Ireland.
University tuition fees vary by region in the UK, as education is a matter for the governments of Scotland, Wales and Northern Ireland. JUSTIN TALLIS AFP

As education is a matter for the governments of Scotland, Wales and Northern Ireland, different tuition fee arrangements are in place across the UK.

Accommodation and living expenses are extra.

In England, undergraduate tuition fees are capped at £9,250 a year for UK and Irish students, up from £3,375 in 2011 when the government cut most ongoing direct public funding.

The cap in Wales is £9,000 and £4,030 in Northern Ireland.

Scottish students studying in Scotland pay £1,820, but those from the rest of the UK attending universities north of the border with England pay £9,250.

Inflation worry

The picture is further complicated by soaring inflation, as the student loan interest rate is tied to the Retail Price Index (RPI).

Loan interest is calculated by adding up to 3.0 percentage points to the RPI rate.

Inflation is at its highest level in 30 years, driving up the price of everyday items such as food, as well as energy costs
Inflation is at its highest level in 30 years, driving up the price of everyday items such as food, as well as energy costs JUSTIN TALLIS AFP

Inflation, however, reached 30-year highs this year, particularly due to soaring energy costs and spillovers from the conflict in Ukraine.

Graduates could therefore pay an interest rate of 12% from September – or more if prices rise even more.

The UK government plays an important role in funding students, providing loans that only require repayment when a graduate earns above a threshold of £27,295 per year.

What borrowers repay depends on how much they earn. Unlike private lenders, they have up to 30 years to repay. The debt is canceled after this period.

“This system is more progressive than in the United States, with generous amortizations for the lowest-paid graduates,” said Nick Hillman, director of the Higher Education Policy Institute at Oxford.

Current and recent students have faced huge upheaval during classes due to coronavirus restrictions, with the pandemic also creating job opportunities.

The coronavirus pandemic has seen in-person classes move online and outrage that many students still have to pay full fees
The coronavirus pandemic has seen in-person classes move online and outrage that many students still have to pay full fees Andy BuchananAFP

A combination of high debt repayments, a high cost of living, and wages that have not kept pace with inflation, add further stress.

Enigma

Student funding poses a major public purse conundrum as the UK predicts outstanding loans will top £560bn by 2050.

From next year Britain will lower the repayment threshold for new borrowers to £25,000 and extend the repayment term from 30 to 40 years.

This will, however, increase costs for low-income earners, while benefiting wealthier graduates who will be able to repay faster.

The UK government, however, expects half of new students to repay their loans in full under the new plan.

Student debt has long been a concern in the United States, where the Federal Reserve estimates it stands at $1.76 trillion.

American college students on average have almost $41,000 in outstanding debt, according to the Education Data Initiative think tank.

President Joe Biden this year extended a moratorium on student loan repayment and interest – and is in talks on partial debt cancellation.

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Diagnosed with medical debt; how advocates work to bring about political change http://lorodinapoli.org/diagnosed-with-medical-debt-how-advocates-work-to-bring-about-political-change/ Wed, 11 May 2022 03:53:00 +0000 http://lorodinapoli.org/diagnosed-with-medical-debt-how-advocates-work-to-bring-about-political-change/ SPRINGFIELD, Mo. (KY3) – The nation is diagnosed with debt related to medical bills. Most of this medical debt in collections is typically found in low-income communities. It affects 14% of Americans across the country. We were able to get information from most counties in the Ozarks. The lowest, on average per person, in our […]]]>

SPRINGFIELD, Mo. (KY3) – The nation is diagnosed with debt related to medical bills.

Most of this medical debt in collections is typically found in low-income communities. It affects 14% of Americans across the country.

We were able to get information from most counties in the Ozarks. The lowest, on average per person, in our area is Barry County at $428 and Laclede County at $477. On the high end is Howell County at $1,223 and Polk County at $1,409. St. Clair County leads the list with $1,708.

Advocates like RIP Medical Debt say 79 million Americans have to choose between paying their medical bills or meeting their basic needs. That’s why they’re working to make long-term changes to hospital policies in addition to paying the bills for families across the country with the help of donors.

“We will never be able to afford it,” said Diana Vandeventer.

Their current stack of medical bills is over 6 inches high. Jon Vandeventer spent months on a ventilator following his battle with COVID-19. He is currently on disability and needs constant care. This leaves Diana Vandeventer out of work.

“People give me stuff and I’ll turn around and sell it. It helped a lot. We were able to eat and the lights are on,” she said.

They say they have no choice but to ignore the nearly $1.5 million in medical debt they face.

“You just know the number and you don’t even answer half the time. You can’t do anything. You’ve told your story 100 times already and it’s falling on deaf ears,” said Diana Vandeventer.

“Mercy would never turn away a patient because of an inability to pay,” said Sterling Coker, Mercy’s director of revenue cycle.

Most hospitals offer help.

“We have financial assistance programs up to 300% of the federal income poverty level. It is one of the most generous financial aid programs in the region,” he said.

CoxHealth sent us this statement regarding its billing process.

“At CoxHealth, patients are our top priority and our Patient Financial Services team is working hard to accommodate patients’ financial circumstances.

Medical billing can be complicated, and our team has put in place a thorough process to not only make it easy for patients to understand their bill, but also to work with our staff on a payment plan based on their individual situation.

From the issuance of an invoice, our patients have 120 days to either reimburse the invoice or set up a payment plan of their own. We also have resources and partnerships available to help uninsured patients or those unable to pay their bill. Our ultimate goal is to collaborate with patients and make the process as easy as possible.

But when providers can’t offer help, RIP Medical Debt tries to step in.

“We want to make sure that when we do this work, we make a statement about it. We’re trying to show that the system is broken, that people don’t feel like it’s a personal failure, that the stigma of medical debt is removed,” said Allison Sesso, executive director of RIP Medical. debt.

Donors in Missouri and Arkansas recognize the need for more than just funding.

Abby Hughes Holsclaw of the Arkansas Asset Funders Network said, “Something is wrong with our system. For the funders I work with and the Arkansas Asset Funders Network table, they did this explicitly to bring media and community attention to this challenge and issue; to make the recommendations for policy and system change that are needed.

They start small to have the biggest impact.

“It is important to work with hospitals to improve their financial aid policies. When we work with hospitals, we provide them with important data that allows them to see how well their financial policies are really working,” Sesso said.

She says she realizes it’s more than wallets that are affected.

“It’s mentally draining for people and it’s detrimental to their physical well-being,” she said.

For the Vandeventers to be freed from their debts would be a relief, but let’s say they have already received their miracle.

“I didn’t want to live without him. I have it here and we are still family,” Diana Vandeventer said.

There is no way to request help from RIP Medical Debt, they select bills randomly.

Experts say the best way to stay on top of your bills is to read them carefully and be sure to call the billing department and ask questions if a statement doesn’t look right.

To report a correction or typo, please email digitalnews@ky3.com

Copyright 2022 KY3. All rights reserved.

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Do you need a graduate degree to compete right now? Probably not http://lorodinapoli.org/do-you-need-a-graduate-degree-to-compete-right-now-probably-not/ Sat, 07 May 2022 16:00:53 +0000 http://lorodinapoli.org/do-you-need-a-graduate-degree-to-compete-right-now-probably-not/ More American workers than ever are holding a graduate degree. Years of increasing professional demands and headlines declaring a master’s degree to be “the new bachelor’s degree” have driven record numbers of students into college. And yet, more and more high-paying jobs no longer require a college degree at all. In this tight job market, […]]]>

More American workers than ever are holding a graduate degree. Years of increasing professional demands and headlines declaring a master’s degree to be “the new bachelor’s degree” have driven record numbers of students into college.

And yet, more and more high-paying jobs no longer require a college degree at all. In this tight job market, do college graduates need a master’s degree to compete? Maybe not.

“We’ve all reduced our near-obsession with mastery,” says Johnny C. Taylor Jr., CEO and President of the Society for Human Resource Management.

Anecdotal and statistical evidence shows that employers were already reducing credential requirements even before the pandemic: Data from a labor market analysis by the Burning Glass Institute shows a reduction in medium and high skill requirements – jobs that require more education than a high school diploma — from 2017 to 2019.

If fewer employers require graduate degrees to get good jobs, prospective students should assess whether graduate degrees are worth the debt.

SOME FIELDS STILL REQUIRE HIGHER DEGREES

Advanced degrees are always the key to enter certain professions: Medicine, law and education come to mind. In other fields, as long as you can convey that you have the skills an employer is looking for, you can get a job without an advanced degree, says Brad Hershbein, senior economist and deputy director of research at the WE Upjohn Institute for job search in Kalamazoo, Michigan.

ADVANCED DEGREES COULD GUARANTEE AGAINST A RECESSION

Employers are likely reducing education requirements to fill positions, which can be difficult in a tight job market like this, experts say. But that doesn’t mean it will last.

“No one can really explain what we’re going through right now; I think everyone thinks it’s temporary,” says Gordon Lafer, a professor at the University of Oregon Labor Education & Research Center.

Having a graduate degree could provide a guarantee for the future. If the economic tide turns, Taylor says, the degree becomes a differentiator.

Higher degrees tend to be correlated with lower unemployment rates compared to bachelor’s or associate’s degrees. But generally, any degree acts as a buffer against unemployment.

During the Great Recession, those with a bachelor’s degree or higher were more likely to keep their jobs, according to a 2014 study from the Georgetown University Center on Education and the Workforce. The same is true for job retention during the early days of the pandemic, according to June 2020 data from the Federal Reserve Bank of San Francisco.

GRADUATE PROGRAMS ARE NOT ALWAYS PAID

What consumers need is data that shows program-specific outcomes like graduate employment rates and average salaries. These are terribly hard to find. For example, the College Scorecard, a data tool from the U.S. Department of Education, which provides outcome information such as graduation rates and graduate salaries, does not include graduate data by major.

The lack of transparency makes it more difficult for prospective students to make an informed decision. And that could lead some to end up with debts that they are unable to repay.

“Not everyone realizes that there’s a risk that it’s a bad financial investment,” Hershbein says.

Graduate loan debt is at an all-time high, according to data from the federal government and think tanks like the Center for American Progress and Brookings. Unlike undergraduate loans, which have stricter limits on the amount of debt students can take on each year, federal Grad PLUS loans and private graduate loans allow students to borrow up to the cost of frequentation, so it is easier to get into debt.

Your earnings after earning a graduate degree will largely depend on your field and your employer. Results in some areas are easier to predict than in others, Hershbein says.

“Teachers’ master’s degrees are carefully calibrated; based on union contracts, they know what the salary will be,” says Hershbein. But the results of the master’s degree in fields like public policy or fine arts are rather unknown, he adds.

MASTERS PROGRAMS ARE NOT ALL EQUAL

Where you graduate also matters. “If you get an online master’s degree from the University of Phoenix, it will pay less than a master’s degree from the University of Pennsylvania,” Hershbein says.

Taylor says the nature of remote learning during the pandemic has erased some of the bias around online programs, but employer preference is still skewed toward elite college degrees.

“I think we have to be honest with ourselves: there’s always an elitism that plays out in the hiring process,” Taylor says.

For graduate students, attending a highly selective university could help them establish professional connections to more easily get a job. And graduate programs are “cash cows” for universities, Hershbein says. Universities rely on the prestige of their undergraduate degrees to attract graduate students to expensive programs.

Students then accumulate exorbitant debts for degrees that may not pay off.

An estimated 40% of master’s programs earn nothing at all, according to February 2022 data from the Foundation for Equal Opportunity Research, a nonprofit think tank.

The uncertainty means prospective students will have to take steps to prevent higher education from hurting their finances more than it helps their job prospects. This means that graduate candidates must:

— Start with the costs of the graduate program on a school’s website.

– Research entry-level earnings and educational requirements for occupations using the Bureau of Labor Statistics’ Occupational Outlook Handbook.

— Browse other tools that list program types and outcomes by degree level, including the the wall street journal and the Georgetown Center on Education and Workforce.

___

This article was provided to The Associated Press by personal finance website NerdWallet. Anna Helhoski is a writer at NerdWallet.

RELATED LINKS

NerdWallet: Calculate: Are Student Loans Worth It Based on Your Major https://bit.ly/nerdwallet-is-college-worth-it-college-debt-calculator

The Wall Street Journal: Is a graduate degree worth the debt? Check it here https://www.wsj.com/articles/is-a-graduate-degree-worth-the-debt-check-it-here-11626355788

Georgetown University Center on Education and Workforce: https://cew.georgetown.edu/cew-reports/collegepayoff2021/

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Is Newton Resources (HKG:1231) a risky investment? http://lorodinapoli.org/is-newton-resources-hkg1231-a-risky-investment/ Tue, 03 May 2022 22:38:24 +0000 http://lorodinapoli.org/is-newton-resources-hkg1231-a-risky-investment/ Warren Buffett said: “Volatility is far from synonymous with risk. It’s natural to consider a company’s balance sheet when looking at its riskiness, as debt is often involved when a company fails. We can see that Newton Resources Ltd. (HKG:1231) uses debt in his business. But the real question is whether this debt makes the […]]]>

Warren Buffett said: “Volatility is far from synonymous with risk. It’s natural to consider a company’s balance sheet when looking at its riskiness, as debt is often involved when a company fails. We can see that Newton Resources Ltd. (HKG:1231) uses debt in his business. But the real question is whether this debt makes the business risky.

What risk does debt carry?

Debt helps a business until the business struggles to pay it back, either with new capital or with free cash flow. Ultimately, if the company cannot meet its legal debt repayment obligations, shareholders could walk away with nothing. However, a more common (but still costly) situation is when a company has to dilute shareholders at a cheap share price just to keep debt under control. Of course, debt can be an important tool in businesses, especially capital-intensive businesses. When we look at debt levels, we first consider cash and debt levels, together.

Check out our latest analysis for Newton Resources

How much debt does Newton Resources have?

As you can see below, Newton Resources had US$5.12 million in debt as of December 2021, up from US$20.3 million the previous year. However, his balance sheet shows that he holds $14.5 million in cash, so he actually has $9.38 million in net cash.

SEHK: 1231 Debt to Equity History May 3, 2022

How healthy is Newton Resources’ balance sheet?

According to the last published balance sheet, Newton Resources had liabilities of $7.36 million due within 12 months and liabilities of $158,000 due beyond 12 months. On the other hand, it had $14.5 million in cash and $1.37 million in receivables within one year. So he actually has 8.36 million US dollars After liquid assets than total liabilities.

This short-term liquidity is a sign that Newton Resources could probably service its debt easily, as its balance sheet is far from stretched. Simply put, the fact that Newton Resources has more cash than debt is arguably a good indication that it can safely manage its debt. The balance sheet is clearly the area to focus on when analyzing debt. But it is the profits of Newton Resources that will influence the balance sheet in the future. So, when considering debt, it is definitely worth looking at the earnings trend. Click here for an interactive preview.

Year-over-year, Newton Resources recorded a loss in EBIT, and saw its revenue fall to US$293m, a decline of 37%. It makes us nervous, to say the least.

So how risky are Newton’s resources?

While Newton Resources lost money in earnings before interest and tax (EBIT), it actually generated positive free cash flow of US$16 million. So taking that at face value and given the net cash position, we don’t think the stock is too risky in the near term. With lackluster revenue growth over the past year, we don’t find the investment opportunity particularly attractive. The balance sheet is clearly the area to focus on when analyzing debt. However, not all investment risks reside on the balance sheet, far from it. Example: we have identified 1 warning sign for Newton Resources you should be aware.

If you are interested in investing in companies that can generate profits without the burden of debt, then check out this free list of growing companies that have net cash on the balance sheet.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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Delivery Hero (ETR:DHER) makes moderate use of debt http://lorodinapoli.org/delivery-hero-etrdher-makes-moderate-use-of-debt/ Mon, 02 May 2022 04:10:24 +0000 http://lorodinapoli.org/delivery-hero-etrdher-makes-moderate-use-of-debt/ Howard Marks said it well when he said that, rather than worrying about stock price volatility, “the possibility of permanent loss is the risk I worry about…and that every practical investor that I know is worried”. When we think of a company’s risk, we always like to look at its use of debt, because over-indebtedness […]]]>

Howard Marks said it well when he said that, rather than worrying about stock price volatility, “the possibility of permanent loss is the risk I worry about…and that every practical investor that I know is worried”. When we think of a company’s risk, we always like to look at its use of debt, because over-indebtedness can lead to ruin. Like many other companies Delivery Hero SE (ETR:DHER) uses debt. But should shareholders worry about its use of debt?

Why is debt risky?

Generally speaking, debt only becomes a real problem when a company cannot easily repay it, either by raising capital or with its own cash flow. Ultimately, if the company cannot meet its legal debt repayment obligations, shareholders could walk away with nothing. However, a more frequent (but still costly) event is when a company has to issue shares at bargain prices, permanently diluting shareholders, just to shore up its balance sheet. Of course, many companies use debt to finance their growth, without any negative consequences. When we look at debt levels, we first consider cash and debt levels, together.

See our latest review for Delivery Hero

What is Delivery Hero Debt?

As you can see below, at the end of December 2021, Delivery Hero had €4.16 billion in debt, up from €2.95 billion a year ago. Click on the image for more details. However, he also had €2.45 ​​billion in cash, so his net debt is €1.72 billion.

XTRA:DHER Debt to Equity History May 2, 2022

How strong is Delivery Hero’s balance sheet?

The latest balance sheet data shows that Delivery Hero had liabilities of €1.75 billion due within one year, and liabilities of €5.46 billion falling due thereafter. In compensation for these obligations, it had cash of 2.45 billion euros as well as receivables worth 428.0 million euros at less than 12 months. It therefore has liabilities totaling 4.34 billion euros more than its cash and short-term receivables, combined.

While that might sound like a lot, it’s not that bad since Delivery Hero has a market cap of €8.23 billion, so it could probably bolster its balance sheet by raising capital if needed. However, it is always worth taking a close look at its ability to repay debt. There is no doubt that we learn the most about debt from the balance sheet. But it’s future revenue, more than anything, that will determine Delivery Hero’s ability to maintain a healthy balance sheet in the future. So if you are focused on the future, you can check out this free report showing analyst earnings forecast.

Last year, Delivery Hero was not profitable in terms of EBIT, but managed to increase its turnover by 137%, to 5.9 billion euros. There is therefore no doubt that shareholders encourage growth

Caveat Emptor

Even though Delivery Hero has managed to grow its revenue quite skillfully, the harsh truth is that it is losing money on the EBIT line. Its EBIT loss was €1.5 billion. Considering that alongside the liabilities mentioned above, this doesn’t give us much confidence that the company should use so much debt. So we think its balance sheet is a little stretched, but not beyond repair. Another reason for caution is that it has lost 1.2 billion euros in negative free cash flow over the past twelve months. In short, it’s a really risky title. There is no doubt that we learn the most about debt from the balance sheet. However, not all investment risks reside on the balance sheet, far from it. Example: we have identified 2 warning signs for Delivery Hero you should be aware.

In the end, sometimes it’s easier to focus on companies that don’t even need to take on debt. Readers can access a list of growth stocks with no net debt 100% freeright now.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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Gartner (NYSE:IT) has a rock-solid balance sheet http://lorodinapoli.org/gartner-nyseit-has-a-rock-solid-balance-sheet/ Sat, 30 Apr 2022 14:45:25 +0000 http://lorodinapoli.org/gartner-nyseit-has-a-rock-solid-balance-sheet/ Warren Buffett said: “Volatility is far from synonymous with risk. So it seems smart money knows that debt – which is usually involved in bankruptcies – is a very important factor when you’re assessing a company’s risk. We note that Gartner, Inc. (NYSE:IT) has debt on its balance sheet. But should shareholders worry about its […]]]>

Warren Buffett said: “Volatility is far from synonymous with risk. So it seems smart money knows that debt – which is usually involved in bankruptcies – is a very important factor when you’re assessing a company’s risk. We note that Gartner, Inc. (NYSE:IT) has debt on its balance sheet. But should shareholders worry about its use of debt?

Why is debt risky?

Generally speaking, debt only becomes a real problem when a company cannot easily repay it, either by raising capital or with its own cash flow. Ultimately, if the company cannot meet its legal debt repayment obligations, shareholders could walk away with nothing. However, a more common (but still painful) scenario is that it has to raise new equity at a low price, thereby permanently diluting shareholders. That said, the most common situation is when a company manages its debt reasonably well – and to its own benefit. The first thing to do when considering how much debt a business has is to look at its cash and debt together.

Discover our latest analysis for Gartner

What is Gartner’s debt?

The image below, which you can click on for more details, shows that as of December 2021, Gartner had $2.52 billion in debt, up from $2.09 billion in one year. However, he also had $756.5 million in cash, so his net debt is $1.76 billion.

NYSE: Historical Debt to Equity Ratio as of April 30, 2022

How strong is Gartner’s balance sheet?

We can see from the most recent balance sheet that Gartner had liabilities of $3.38 billion due in one year, and liabilities of $3.67 billion beyond. On the other hand, it had a cash position of 756.5 million dollars and 1.39 billion dollars in receivables at less than one year. Thus, its liabilities outweigh the sum of its cash and (current) receivables by $4.90 billion.

Gartner has a very large market capitalization of US$23.6 billion, so it could very likely raise funds to improve its balance sheet, should the need arise. However, it is always worth taking a close look at its ability to repay debt.

We use two main ratios to inform us about debt to earnings levels. The first is net debt divided by earnings before interest, taxes, depreciation and amortization (EBITDA), while the second is how often its earnings before interest and taxes (EBIT) covers its interest expense (or its interests, for short). In this way, we consider both the absolute amount of debt, as well as the interest rates paid on it.

Gartner’s net debt to EBITDA ratio of around 1.5 suggests only moderate use of debt. And its strong interest coverage of 10.1 times puts us even more at ease. On top of that, Gartner has grown its EBIT by 96% in the last twelve months, and this growth will make it easier to manage its debt. The balance sheet is clearly the area to focus on when analyzing debt. But ultimately, the company’s future profitability will decide whether Gartner can strengthen its balance sheet over time. So if you want to see what the professionals think, you might find this free analyst earnings forecast report interesting.

Finally, a business needs free cash flow to pay off its debts; book profits are not enough. It is therefore worth checking how much of this EBIT is supported by free cash flow. Fortunately for all shareholders, Gartner has actually produced more free cash flow than EBIT for the past three years. There’s nothing better than incoming money to stay in the good books of your lenders.

Our point of view

Fortunately, Gartner’s impressive EBIT to free cash flow conversion means it has the upper hand on its debt. And the good news does not stop there, since its EBIT growth rate also confirms this impression! Overall, we think Gartner’s use of debt seems entirely reasonable and we’re not concerned about that. After all, reasonable leverage can increase return on equity. There is no doubt that we learn the most about debt from the balance sheet. But at the end of the day, every business can contain risks that exist outside of the balance sheet. These risks can be difficult to spot. Every business has them, and we’ve spotted 3 warning signs for Gartner (1 of which should not be ignored!) that you should know.

If, after all that, you’re more interested in a fast-growing company with a strong balance sheet, check out our list of cash-neutral growth stocks right away.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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Vital Healthcare raises funds to finance its expansion on the South Island http://lorodinapoli.org/vital-healthcare-raises-funds-to-finance-its-expansion-on-the-south-island/ Wed, 27 Apr 2022 22:42:12 +0000 http://lorodinapoli.org/vital-healthcare-raises-funds-to-finance-its-expansion-on-the-south-island/ Medical real estate investor Vital Healthcare Property Trust plans to raise $200 million to fund a pair of acquisitions and developments of existing properties on the South Island. Photo: 123RF The company would raise capital through a secured rights offering. This would give existing unit holders the option to buy one unit for 8.54 units […]]]>

Medical real estate investor Vital Healthcare Property Trust plans to raise $200 million to fund a pair of acquisitions and developments of existing properties on the South Island.

Photo: 123RF

The company would raise capital through a secured rights offering. This would give existing unit holders the option to buy one unit for 8.54 units they hold at an offer price of $2.95.

The offer represents a discount of 5.4% on the last traded price of $3.12 and was 4.9% below the theoretical price excluding duties of $3.10.

Vital plans to buy its first properties on the South Island, which include a health center at Kawarau in Queenstown and an outpatient facility in Christchurch for a total of $145 million.

“The acquisitions announced today will strengthen Vital’s geographic diversification and mark our strategic entry into the South Island of New Zealand,” said Aaron Hockly, fund manager of Vital.

“In addition, we are delighted to announce two additional developments that stem from our long-standing relationships with New Zealand’s three largest private hospital operators.”

The company said it had offered to buy Endoscopy Auckland for $22.2 million and planned to spend $21.6 million building a new surgery and endoscopy center.

He also planned to expand Ormiston Hospital, which he already owns, by spending $40 million to develop a new building that would connect to existing facilities via a skybridge.

“These developments will allow us to provide additional healthcare infrastructure for Auckland while providing adjusted operating funds and valuation growth for Vital unitholders.”

The net proceeds from the capital increase would be used to repay debt incurred for recently announced acquisitions and developments, including those announced today.

Vital Healthcare is managed by NorthWest Healthcare Properties Management, which is a subsidiary of Toronto-listed global healthcare fund manager NorthWest Healthcare Properties REIT.

NorthWest had agreed to subscribe for $55 million worth of units to represent its 27.5% stake in Vital.

The balance of the offering is guaranteed by Craig’s Investment Partners and Forsyth Barr.

The offering would be open to existing institutional investors first, followed by an institutional bookbuilding, then the opening of the retail offering and subsequent retail bookbuilding.

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Sri Lanka discusses loan from China to cover past debts http://lorodinapoli.org/sri-lanka-discusses-loan-from-china-to-cover-past-debts/ Tue, 26 Apr 2022 08:11:54 +0000 http://lorodinapoli.org/sri-lanka-discusses-loan-from-china-to-cover-past-debts/ Placeholder while loading article actions COLOMBO, Sri Lanka — The Sri Lankan government said on Tuesday it was considering getting another loan from Beijing to pay off some of its debt to Chinese banks after China told the nearly bankrupt island nation that ‘She was not in favor of restructuring existing loans. Sri Lanka has […]]]>
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COLOMBO, Sri Lanka — The Sri Lankan government said on Tuesday it was considering getting another loan from Beijing to pay off some of its debt to Chinese banks after China told the nearly bankrupt island nation that ‘She was not in favor of restructuring existing loans.

Sri Lanka has nearly $7 billion in foreign debt to repay this year and will have to repay $25 billion over the next five years. A severe shortage of foreign currency means the country l acks money to buy imported goodsresulting in shortages of food, fuel and other essentials.

The economic crisis has brought weeks of protests across the country to demand the resignation of President Gotabaya Rajapaksa.

Government spokesman Nalaka Godahewa said Beijing was reluctant to restructure Sri Lanka’s debt because it did not want to set that precedent. He told reporters that the finance ministry would later announce details of talks with China.

Earlier this month the government said it was suspend the repayment of foreign loans pending negotiations with the International Monetary Fund for a loan restructuring plan.

Sri Lanka’s debt problems are partly because it has built infrastructure such as a port, airport and road networks using Chinese loans, but the projects are not bringing in money .

Rajapaksa had asked Chinese Foreign Minister Wang Yi, who visited Sri Lanka in January, to restructure these loans.

Central Bank figures show that existing Chinese loans to Sri Lanka total around $3.38 billion, not including loans to state-owned enterprises, which are counted separately and considered large.

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