Knife River Debt
| KNF Stock | 103.50 0.75 0.73% |
At this time, Knife River's Long Term Debt Total is most likely to decrease significantly in the upcoming years. The Knife River's current Net Debt To EBITDA is estimated to increase to 2.13, while Short and Long Term Debt is projected to decrease to roughly 6.7 M. . Knife River's financial risk is the risk to Knife River stockholders that is caused by an increase in debt.
Debt Ratio | First Reported 2010-12-31 | Previous Quarter 0.2621954 | Current Value 0.31 | Quarterly Volatility 0.01621036 |
Given that Knife River's debt-to-equity ratio measures a Company's obligations relative to the value of its net assets, it is usually used by traders to estimate the extent to which Knife River 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 Knife River to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Knife River is said to be less leveraged. If creditors hold a majority of Knife River's assets, the Company is said to be highly leveraged.
At this time, Knife River's Non Current Liabilities Other is most likely to increase significantly in the upcoming years. Knife |
Knife River Bond Ratings
Knife River financial ratings play a critical role in determining how much Knife River 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 Knife River's borrowing costs.| Piotroski F Score | 3 | Frail | View |
| Beneish M Score | (2.24) | Unlikely Manipulator | View |
Knife River Debt to Cash Allocation
Many companies such as Knife River, 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.
Knife River has 726.37 M in debt. Note however, debt could still be an excellent tool for Knife to invest in growth at high rates of return. Knife River Assets Financed by Debt
The debt-to-assets ratio shows the degree to which Knife River 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.Knife River Debt Ratio | 31.0 |
Knife River Corporate Bonds Issued
Most Knife bonds can be classified according to their maturity, which is the date when Knife River has to pay back the principal to investors. Maturities can be short-term, medium-term, or long-term (more than ten years). Longer-term bonds usually offer higher interest rates but may entail additional risks.
Knife Short Long Term Debt Total
Short Long Term Debt Total |
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Understaning Knife River Use of Financial Leverage
Knife River's financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures Knife River's total debt position, including all outstanding debt obligations, and compares it with Knife River's equity. Financial leverage can amplify the potential profits to Knife River's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if Knife River is unable to cover its debt costs.
| Last Reported | Projected for Next Year | ||
| Short and Long Term Debt Total | 726.4 M | 636.3 M | |
| Net Debt | 464 M | 503.7 M | |
| Long Term Debt | 674.6 M | 781 M | |
| Long Term Debt Total | 402.2 M | 409.2 M | |
| Short and Long Term Debt | 7.1 M | 6.7 M | |
| Short Term Debt | 20 M | 19 M | |
| Net Debt To EBITDA | 1.09 | 2.13 | |
| Debt To Equity | 0.54 | 0.70 | |
| Interest Debt Per Share | 13.07 | 7.81 | |
| Debt To Assets | 0.26 | 0.31 | |
| Long Term Debt To Capitalization | 0.35 | 0.37 | |
| Total Debt To Capitalization | 0.35 | 0.43 | |
| Debt Equity Ratio | 0.54 | 0.70 | |
| Debt Ratio | 0.26 | 0.31 | |
| Cash Flow To Debt Ratio | 0.49 | 0.28 |
Currently Active Assets on Macroaxis
When determining whether Knife River is a strong investment it is important to analyze Knife River's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Knife River's future performance. For an informed investment choice regarding Knife Stock, refer to the following important reports:Check out the analysis of Knife River Fundamentals Over Time. For more detail on how to invest in Knife Stock please use our How to Invest in Knife River guide.You can also try the Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Is Diversified Metals & Mining 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 Knife River. If investors know Knife 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 Knife River listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 0.008 | Earnings Share 3.51 | Revenue Per Share 51.039 | Quarterly Revenue Growth 0.014 | Return On Assets 0.0726 |
The market value of Knife River is measured differently than its book value, which is the value of Knife that is recorded on the company's balance sheet. Investors also form their own opinion of Knife River's value that differs from its market value or its book value, called intrinsic value, which is Knife River's 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 Knife River's market value can be influenced by many factors that don't directly affect Knife River's 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 Knife River's value and its price as these two are different measures arrived at by different means. Investors typically determine if Knife River is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Knife River's 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.