Pioneer Power Debt
| PPSI Stock | USD 3.21 0.04 1.23% |
Pioneer Power Solutions holds a debt-to-equity ratio of 0.142. The Pioneer Power's current Net Debt To EBITDA is estimated to increase to 2.30, while Net Debt is forecasted to increase to (2 M). With a high degree of financial leverage come high-interest payments, which usually reduce Pioneer Power's Earnings Per Share (EPS).
Asset vs Debt
Equity vs Debt
Pioneer Power'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. Pioneer Power'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 Pioneer Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Pioneer Power's stakeholders.
For most companies, including Pioneer Power, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Pioneer Power Solutions, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Pioneer Power's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
As of now, Pioneer Power's Total Current Liabilities is decreasing as compared to previous years. The Pioneer Power's current Liabilities And Stockholders Equity is estimated to increase to about 48.7 M, while Non Current Liabilities Total is projected to decrease to under 463.4 K. Pioneer |
Pioneer Power Bond Ratings
Pioneer Power Solutions financial ratings play a critical role in determining how much Pioneer Power 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 Pioneer Power's borrowing costs.| Piotroski F Score | 4 | Poor | View |
| Beneish M Score | (1.93) | Possible Manipulator | View |
Pioneer Power Solutions Debt to Cash Allocation
As Pioneer Power Solutions follows its natural business cycle, the capital allocation decisions will not magically go away. Pioneer Power's decision-makers have to determine if most of the cash flows will be poured back into or reinvested in the business, reserved for other projects beyond operational needs, or paid back to stakeholders and investors.
Pioneer Power Solutions currently holds 1.21 M in liabilities with Debt to Equity (D/E) ratio of 0.14, which may suggest the company is not taking enough advantage from borrowing. Pioneer Power Solutions has a current ratio of 1.94, which is within standard range for the sector. Note, when we think about Pioneer Power's use of debt, we should always consider it together with its cash and equity.Pioneer Power Total Assets Over Time
Pioneer Power Assets Financed by Debt
The debt-to-assets ratio shows the degree to which Pioneer Power 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.Pioneer Power Debt Ratio | 4.02 |
Pioneer Power Corporate Bonds Issued
Most Pioneer bonds can be classified according to their maturity, which is the date when Pioneer Power Solutions 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.
Pioneer Net Debt
Net Debt |
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Understaning Pioneer Power Use of Financial Leverage
Understanding the composition and structure of Pioneer Power's debt gives an idea of how risky is the capital structure of the business and if it is worth investing in it. The degree of Pioneer Power's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets).
| Last Reported | Projected for Next Year | ||
| Net Debt | -2.1 M | -2 M | |
| Short and Long Term Debt Total | 1.1 M | 1 M | |
| Short Term Debt | 648.9 K | 616.5 K | |
| Long Term Debt | 569.7 K | 541.2 K | |
| Long Term Debt Total | 569.7 K | 541.2 K | |
| Short and Long Term Debt | 702 K | 666.9 K | |
| Net Debt To EBITDA | 2.19 | 2.30 | |
| Debt To Equity | 0.10 | 0.09 | |
| Interest Debt Per Share | 0.14 | 0.13 | |
| Debt To Assets | 0.04 | 0.04 | |
| Long Term Debt To Capitalization | 0.08 | 0.07 | |
| Total Debt To Capitalization | 0.09 | 0.09 | |
| Debt Equity Ratio | 0.10 | 0.09 | |
| Debt Ratio | 0.04 | 0.04 | |
| Cash Flow To Debt Ratio | (3.69) | (3.51) |
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When determining whether Pioneer Power Solutions offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Pioneer Power's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Pioneer Power Solutions Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Pioneer Power Solutions Stock:Check out the analysis of Pioneer Power Fundamentals Over Time. You can also try the Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Is Heavy Electrical Equipment 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 Pioneer Power. If investors know Pioneer 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 Pioneer Power 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 (0.81) | Earnings Share (0.87) | Revenue Per Share | Quarterly Revenue Growth (0.05) | Return On Assets |
The market value of Pioneer Power Solutions is measured differently than its book value, which is the value of Pioneer that is recorded on the company's balance sheet. Investors also form their own opinion of Pioneer Power's value that differs from its market value or its book value, called intrinsic value, which is Pioneer Power'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 Pioneer Power's market value can be influenced by many factors that don't directly affect Pioneer Power'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 Pioneer Power's value and its price as these two are different measures arrived at by different means. Investors typically determine if Pioneer Power is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Pioneer Power'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.