Vintage Wine Current Debt
| VWE Stock | USD 0.31 0.01 3.66% |
Vintage Wine Estates holds a debt-to-equity ratio of 1.001. At present, Vintage Wine's Interest Debt Per Share is projected to decrease significantly based on the last few years of reporting. Vintage Wine's financial risk is the risk to Vintage Wine stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Vintage Wine'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. Vintage Wine'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 Vintage Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Vintage Wine's stakeholders.
Vintage Wine Quarterly Net Debt |
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For most companies, including Vintage Wine, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for the executing running Vintage Wine Estates the most critical issue when dealing with liquidity needs is whether the current assets are properly aligned with its current liabilities. If not, management will need to obtain alternative financing to ensure that there are always enough cash equivalents on the balance sheet in reserve to pay for obligations.
Price Book 0.1451 | Book Value 1.433 | Operating Margin (0.32) | Profit Margin (0.59) | Return On Assets (0.08) |
Given that Vintage Wine'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 Vintage Wine 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 Vintage Wine to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Vintage Wine is said to be less leveraged. If creditors hold a majority of Vintage Wine's assets, the Company is said to be highly leveraged.
At present, Vintage Wine's Interest Debt Per Share is projected to decrease significantly based on the last few years of reporting. Vintage |
Vintage Wine Financial Leverage Rating
Vintage Wine Estates bond ratings play a critical role in determining how much Vintage Wine 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 Vintage Wine's borrowing costs.| Piotroski F Score | 5 Healthy |
| Beneish M Score | 22.64 Possible Manipulator |
Vintage Wine Estates Debt to Cash Allocation
As Vintage Wine Estates follows its natural business cycle, the capital allocation decisions will not magically go away. Vintage Wine'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. Many companies 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.
The company has 336.98 M in debt with debt to equity (D/E) ratio of 1.0, which is OK given its current industry classification. Vintage Wine Estates has a current ratio of 1.46, which is typical for the industry and considered as normal. Debt can assist Vintage Wine until it has trouble settling it off, either with new capital or with free cash flow. So, Vintage Wine'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 Vintage Wine Estates sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Vintage to invest in growth at high rates of return. When we think about Vintage Wine's use of debt, we should always consider it together with cash and equity.Vintage Wine Other Current Liab Over Time
Vintage Wine 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 Vintage Wine's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Vintage Wine, which in turn will lower the firm's financial flexibility. Like all other financial ratios, a a Vintage Wine debt ratio should be compared their industry average or other competing firms.Vintage Net Debt
Net Debt |
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Understaning Vintage Wine Use of Financial Leverage
Vintage Wine financial leverage ratio helps in determining the effect of debt on the overall profitability of the company. It measures Vintage Wine's total debt position, including all of 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 Vintage Wine assets, the company is considered highly leveraged. Understanding the composition and structure of overall Vintage Wine debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business and if it is worth investing in it. Financial leverage can amplify the potential profits to Vintage Wine's 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 Vintage Wine'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 | 318.7 M | 231.2 M | |
| Short and Long Term Debt Total | 337 M | 352.3 M | |
| Long Term Debt | 199.4 M | 185.6 M | |
| Short and Long Term Debt | 116.9 M | 114.5 M | |
| Short Term Debt | 136.4 M | 115.8 M | |
| Net Debt To EBITDA | (22.75) | (21.61) | |
| Debt To Equity | 2.24 | 1.73 | |
| Interest Debt Per Share | 6.92 | 10.14 | |
| Debt To Assets | 0.54 | 0.38 | |
| Long Term Debt To Capitalization | 0.62 | 0.51 | |
| Total Debt To Capitalization | 0.76 | 0.64 | |
| Debt Equity Ratio | 2.24 | 1.73 | |
| Debt Ratio | 0.54 | 0.38 | |
| Cash Flow To Debt Ratio | (0.02) | (0.02) |
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Analyzing currently trending equities could be an opportunity to develop a better portfolio based on different market momentums that they can trigger. Utilizing the top trending stocks is also useful when creating a market-neutral strategy or pair trading technique involving a short or a long position in a currently trending equity.When determining whether Vintage Wine Estates is a strong investment it is important to analyze Vintage Wine'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 Vintage Wine's future performance. For an informed investment choice regarding Vintage Stock, refer to the following important reports:Check out the analysis of Vintage Wine Fundamentals Over Time. You can also try the Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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When running Vintage Wine's price analysis, check to measure Vintage Wine'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 Vintage Wine is operating at the current time. Most of Vintage Wine's value examination focuses on studying past and present price action to predict the probability of Vintage Wine's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Vintage Wine's price. Additionally, you may evaluate how the addition of Vintage Wine to your portfolios can decrease your overall portfolio volatility.
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Is Vintage Wine's industry 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 Vintage Wine. If investors know Vintage 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 Vintage Wine 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 (0.64) | Earnings Share (2.33) | Revenue Per Share 3.914 | Quarterly Revenue Growth (0.29) | Return On Assets (0.08) |
The market value of Vintage Wine Estates is measured differently than its book value, which is the value of Vintage that is recorded on the company's balance sheet. Investors also form their own opinion of Vintage Wine's value that differs from its market value or its book value, called intrinsic value, which is Vintage Wine'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 Vintage Wine's market value can be influenced by many factors that don't directly affect Vintage Wine'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 Vintage Wine's value and its price as these two are different measures arrived at by different means. Investors typically determine if Vintage Wine is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Vintage Wine'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.