Leaf Mobile Current Debt
| EAGRF Stock | USD 0.42 0.04 8.70% |
Leaf Mobile holds a debt-to-equity ratio of 0.005. . Leaf Mobile's financial risk is the risk to Leaf Mobile stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Leaf Mobile'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. Leaf Mobile's cash, liquid assets, total liabilities, and shareholder equity can be utilized to evaluate how much leverage the OTC Stock is using to sustain its current operations. For traders, higher-leverage indicators usually imply a higher risk to shareholders. In addition, it helps Leaf OTC Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Leaf Mobile's stakeholders.
For most companies, including Leaf Mobile, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Leaf Mobile, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Leaf Mobile's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Given that Leaf Mobile's debt-to-equity ratio measures a OTC Stock's obligations relative to the value of its net assets, it is usually used by traders to estimate the extent to which Leaf Mobile 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 Leaf Mobile to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Leaf Mobile is said to be less leveraged. If creditors hold a majority of Leaf Mobile's assets, the OTC Stock is said to be highly leveraged.
Leaf |
Leaf Mobile Debt to Cash Allocation
Many companies such as Leaf Mobile, eventually find out that there is only so much market out there to be conquered, and adding the next product or service is only half as profitable per unit as their current endeavors. Eventually, the company will reach a point where cash flows are strong, and extra cash is available but not fully utilized. In this case, the company may start buying back its stock from the public or issue more dividends.
Leaf Mobile has accumulated 293.79 K in total debt with debt to equity ratio (D/E) of 0.01, which may suggest the company is not taking enough advantage from borrowing. Leaf Mobile has a current ratio of 1.23, suggesting that it is not liquid enough and may have problems paying out its financial obligations in time and when they become due. Debt can assist Leaf Mobile until it has trouble settling it off, either with new capital or with free cash flow. So, Leaf Mobile's shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Leaf Mobile sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Leaf to invest in growth at high rates of return. When we think about Leaf Mobile's use of debt, we should always consider it together with cash and equity.Leaf Mobile 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 Leaf Mobile's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Leaf Mobile, which in turn will lower the firm's financial flexibility.Understaning Leaf Mobile Use of Financial Leverage
Leaf Mobile's financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures Leaf Mobile's total debt position, including all outstanding debt obligations, and compares it with Leaf Mobile's equity. Financial leverage can amplify the potential profits to Leaf Mobile's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if Leaf Mobile is unable to cover its debt costs.
Leaf Mobile Inc., through its subsidiaries, develops and publishes free-to-play casual mobile games worldwide. The company was incorporated in 2018 and is headquartered in Vancouver, Canada. East Side operates under Electronic Gaming Multimedia classification in the United States and is traded on OTC Exchange. It employs 200 people. Please read more on our technical analysis page.
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Other Information on Investing in Leaf OTC Stock
Leaf Mobile financial ratios help investors to determine whether Leaf OTC Stock is cheap or expensive when compared to a particular measure, such as profits or enterprise value. In other words, they help investors to determine the cost of investment in Leaf with respect to the benefits of owning Leaf Mobile security.
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.