Liabilities Breakdown
192.9 M
Current Liabilities
Long-Term Liabilities
| Total Liabilities | 204.74 Million | |
| Current Liabilities | 192.91 Million | |
| Long-Term Liabilities | 11.83 Million | |
| Tax Liabilities | 1.54 Million |
How much will Powell Industries owe in September?
 | By Raphi Shpitalnik | Macroaxis Story |
Powell Industries, a leader in the Electrical Equipment & Parts industry, has been demonstrating a strong financial performance, even amidst a modest market downturn. With a total revenue of 532.6M, an income before tax of 9.8M, and a solid net tangible assets of 296.2M, the company's robust financial health is evident. From a leverage perspective, Powell's prudent management of capital is noteworthy, with capital expenditures at a minimal 2.5M and deferred long-term liabilities at a manageable 7.7M. Despite a negative cash flow from financing activities of 13.3M, the company has maintained a healthy cash flow of 114.3M at the beginning of the period. This, coupled with a price change of 24.25, indicates a promising investment opportunity in Powell Industries.
Supplemental assessment
Powell Industries currently has $2.32 million in liabilities, with a Debt to Equity (D/E) ratio of 0.01. This suggests that Powell Industries may not be leveraging borrowing to its full potential. The company's current ratio stands at 2.21, indicating that it is sufficiently liquid to meet its financial obligations as they come due. While debt can be beneficial for Powell Industries until it encounters difficulties in repayment, either through new capital or free cash flow, it's important to note that if the company fails to meet its legal debt obligations, shareholders could potentially lose their entire investment. However, a more common scenario is when companies like Powell Industries issue additional shares at discounted prices, thereby diluting the value of existing shares. In such cases, debt can be a more effective tool for Powell Industries to invest in high-growth opportunities that yield high returns. When evaluating Powell Industries' use of debt, it's crucial to consider it in conjunction with cash and equity.Macroaxis uses a strict editorial review process to publish stories and blog posts. Our publishers support our company and may receive a small commission when the partner links or references are utilized. Commissions do not affect the opinions or evaluations of our editorial team. The information our editors and media partners deliver is confidential and licensed for your sole use as a Macroaxis user. We reserve all rights to the content of this article, and therefore copying or distributing this story in whole or in part is strictly prohibited.
Reviewed by Vlad Skutelnik
In the face of a modest market downturn, Powell Industries, a prominent player in the Electrical Equipment & Parts industry, has shown remarkable resilience, outperforming many of its peers. Despite a decrease in cash flow from $114.3M at the beginning of the period to $102M at the end, the company managed to maintain a robust total stockholder equity of $297.2M. Powell Industries' net income applicable to common shares was a healthy $13.7M, with a gross profit of $85M. This was achieved despite a change to account receivables of -$31.6M, indicating a loss in this area. The company also faced a tax provision of -$3.9M, further impacting its financial performance. The company's capital expenditures stood at a modest $2.5M, while its property, plant, and equipment net amounted to $98.6M. It also reported other assets worth $24.8M and intangible assets of $1M. Powell Industries' retained earnings, a key indicator of its financial health, stood at a solid $283.6M, matching its total equity. This is a testament to the company's ability to generate profits and reinvest them back into the business. The company also reported a forward dividend yield of 0.0173, indicating a potential return for investors. However, investors should also consider the possible downside price of $68.54 and the valuation real value of $64.28. Despite the challenges, Powell Industries' performance in the domestic market has been commendable, demonstrating its ability to leverage its strengths and navigate market downturns. This resilience, combined with its solid financials, makes Powell Industries a stock to watch in the Electrical Equipment sector. Powell Industries' stock continues to experience above-average trading activity. The company's Invested Capital remains relatively stable compared to the previous year, currently estimated at $195.15 million. The average Invested Capital is projected to increase to approximately $204.7 million this year. However, the value of Revenue Per Employee is likely to decrease to around $206.1 thousand. Despite many baby boomers showing indifference towards the electrical equipment sector, Powell Industries stands out as a unique choice for millennials.Powell Industries financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Powell Industries, including all of Powell Industries's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Powell Industries assets, the company is considered highly leveraged. Understanding the composition and structure of overall Powell Industries debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.
Understanding Powell Total Liabilities
Powell Industries liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Powell Industries has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Powell Industries balance sheet include debt obligations and money owed to different Powell Industries vendors, workers, and loan providers. Below is the chart of Powell short long-term liabilities accounts currently reported on its balance sheet. You can use Powell Industries financial leverage analysis tool to get a better grip on understanding its financial positionHow important is Powell Industries's Liquidity
Powell Industries financial leverage refers to using borrowed capital as a funding source to finance Powell Industries ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Powell Industries financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Powell Industries' owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Powell Industries' 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). Please check the breakdown between Powell Industries's total debt and its cash.
Another Outlook On Powell Industries
Powell Industries reported the previous year's revenue of 532.58 M. Net Income was 13.74 M with profit before overhead, payroll, taxes, and interest of 85.02 M.
Despite a modest downturn in the market, Powell Industries has managed to outperform expectations, demonstrating the company's resilience and strategic financial management. With a current ratio of 2.25X, the company exhibits a strong ability to meet its short-term obligations, further bolstered by a net borrowing position of -400K, indicating a surplus rather than a deficit. The company's operating margin stands at 0.0375%, reflecting a relatively efficient operation, while its price to book ratio of 1.45X suggests that the stock is reasonably valued.Powell Industries also has a forward dividend yield of 0.0173, which may appeal to income-focused investors. The company's financial health is further evidenced by its net tangible assets of 296.2M and a total current asset base of 370M. Despite a change in working capital of -24.1M, the company's cash per share ratio of 8.36X indicates a robust cash position. In conclusion, Powell Industries' strong financial leverage, combined with its ability to weather market downturns, makes it a compelling consideration for investors. However, as always, potential investors should conduct their own due diligence before making investment decisions. .
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