Focus Universal Debt
| FCUV Stock | USD 0.25 0.01 3.85% |
Focus Universal holds a debt-to-equity ratio of 0.03. At this time, Focus Universal's Net Debt is fairly stable compared to the past year. Short Term Debt is likely to climb to about 1.1 M in 2024, whereas Long Term Debt is likely to drop slightly above 22.2 K in 2024. . Focus Universal's financial risk is the risk to Focus Universal stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Focus Universal'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. Focus Universal'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 Focus Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Focus Universal's stakeholders.
For most companies, including Focus Universal, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Focus Universal, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Focus Universal'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 3.3482 | Book Value 0.076 | Operating Margin (23.54) | Profit Margin (2.65) | Return On Assets (0.57) |
Focus |
Focus Universal Bond Ratings
Focus Universal financial ratings play a critical role in determining how much Focus Universal 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 Focus Universal's borrowing costs.| Piotroski F Score | 3 | Frail | View |
| Beneish M Score | (4.94) | Unlikely Manipulator | View |
Focus Universal Debt to Cash Allocation
Many companies such as Focus Universal, 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.
Focus Universal currently holds 1.12 M in liabilities with Debt to Equity (D/E) ratio of 0.03, which may suggest the company is not taking enough advantage from borrowing. Focus Universal has a current ratio of 22.88, suggesting that it is liquid enough and is able to pay its financial obligations when due. Note, when we think about Focus Universal's use of debt, we should always consider it together with its cash and equity.Focus Universal Total Current Liabilities Over Time
Focus Universal Assets Financed by Debt
The debt-to-assets ratio shows the degree to which Focus Universal 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.Focus Universal Debt Ratio | 22.0 |
Focus Universal Corporate Bonds Issued
Focus Net Debt
Net Debt |
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Understaning Focus Universal Use of Financial Leverage
Understanding the structure of Focus Universal's debt obligations provides insight if it is worth investing in it. Financial leverage can amplify the potential profits to Focus Universal'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 | 690.3 K | 724.8 K | |
| Short and Long Term Debt | 152.5 K | 103.9 K | |
| Short Term Debt | 1000 K | 1.1 M | |
| Short and Long Term Debt Total | 1.1 M | 1.2 M | |
| Long Term Debt | 23.3 K | 22.2 K | |
| Long Term Debt Total | 23.3 K | 22.2 K | |
| Net Debt To EBITDA | (0.15) | (0.15) | |
| Debt To Equity | 0.32 | 0.33 | |
| Interest Debt Per Share | 0.02 | 0.02 | |
| Debt To Assets | 0.21 | 0.22 | |
| Long Term Debt To Capitalization | 0.03 | 0.03 | |
| Total Debt To Capitalization | 0.24 | 0.23 | |
| Debt Equity Ratio | 0.32 | 0.33 | |
| Debt Ratio | 0.21 | 0.22 | |
| Cash Flow To Debt Ratio | (3.15) | (3.31) |
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Additional Tools for Focus Stock Analysis
When running Focus Universal's price analysis, check to measure Focus Universal'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 Focus Universal is operating at the current time. Most of Focus Universal's value examination focuses on studying past and present price action to predict the probability of Focus Universal's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Focus Universal's price. Additionally, you may evaluate how the addition of Focus Universal 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.