Slate Grocery Current Debt
| SRRTF Stock | USD 9.75 0.14 1.46% |
Slate Grocery REIT holds a debt-to-equity ratio of 1.36. . Slate Grocery's financial risk is the risk to Slate Grocery stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Slate Grocery'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. Slate Grocery'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 Slate Pink Sheet's retail investors understand whether an upcoming fall or rise in the market will negatively affect Slate Grocery's stakeholders.
For most companies, including Slate Grocery, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Slate Grocery REIT, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Slate Grocery'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 Slate Grocery'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 Slate Grocery 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 Slate Grocery to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Slate Grocery is said to be less leveraged. If creditors hold a majority of Slate Grocery's assets, the Company is said to be highly leveraged.
Slate |
Slate Grocery REIT Debt to Cash Allocation
Many companies such as Slate Grocery, 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.
Slate Grocery REIT has accumulated 929.22 M in total debt with debt to equity ratio (D/E) of 1.36, which is about average as compared to similar companies. Slate Grocery REIT has a current ratio of 0.39, indicating that it has a negative working capital and may not be able to pay financial obligations in time and when they become due. Debt can assist Slate Grocery until it has trouble settling it off, either with new capital or with free cash flow. So, Slate Grocery'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 Slate Grocery REIT sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Slate to invest in growth at high rates of return. When we think about Slate Grocery's use of debt, we should always consider it together with cash and equity.Slate Grocery 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 Slate Grocery's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Slate Grocery, which in turn will lower the firm's financial flexibility.Understaning Slate Grocery Use of Financial Leverage
Slate Grocery's financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures Slate Grocery's total debt position, including all outstanding debt obligations, and compares it with Slate Grocery's equity. Financial leverage can amplify the potential profits to Slate Grocery's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if Slate Grocery is unable to cover its debt costs.
Slate Grocery REIT is an owner and operator of U.S. grocery-anchored real estate. The REITs resilient grocery-anchored portfolio and strong credit tenants provide unitholders with durable cash flows and the potential for capital appreciation over the longer term. Slate Retail operates under REITRetail classification in the United States and is traded on OTC Exchange. Please read more on our technical analysis page.
Currently Active Assets on Macroaxis
Other Information on Investing in Slate Pink Sheet
Slate Grocery financial ratios help investors to determine whether Slate Pink Sheet 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 Slate with respect to the benefits of owning Slate Grocery 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.