Coterra Energy (NYSE:CTRA) Seems To Use Debt Quite Sensibly
Coterra Energy (NYSE:CTRA) Seems To Use Debt Quite Sensibly
Howard Marks put it nicely when he said that, rather than worrying about share price volatility, 'The possibility of permanent loss is the risk I worry about... and every practical investor I know worries about.' So it seems the smart money knows that debt - which is usually involved in bankruptcies - is a very important factor, when you assess how risky a company is. As with many other companies Coterra Energy Inc. (NYSE:CTRA) makes use of debt. But should shareholders be worried about its use of debt?
霍华德·马克思曾经这样形容:与其担心股价波动,‘我担心的是可能遭受的永久性损失……任何一个务实的投资者都会担心这个问题。’看起来,一些明智的人们意识到,债务——这通常是破产中涉及的因素之一——是评估公司风险时非常重要的因素。与许多其他公司一样,Coterra Energy Inc. (NYSE:CTRA)也使用了债务。但股东们应该担心它使用债务的情况吗?
When Is Debt Dangerous?
债务何时有危险?
Debt and other liabilities become risky for a business when it cannot easily fulfill those obligations, either with free cash flow or by raising capital at an attractive price. Ultimately, if the company can't fulfill its legal obligations to repay debt, shareholders could walk away with nothing. However, a more frequent (but still costly) occurrence is where a company must issue shares at bargain-basement prices, permanently diluting shareholders, just to shore up its balance sheet. Of course, the upside of debt is that it often represents cheap capital, especially when it replaces dilution in a company with the ability to reinvest at high rates of return. When we examine debt levels, we first consider both cash and debt levels, together.
当一家公司无法通过自由现金流或以有吸引力的价格筹集资金来轻松履行债务和其他负债时, 债务和其他负债会对公司造成风险。最终,如果公司不能履行偿还债务的法律义务,股东可能会一无所获。然而,一种更频繁但仍然代价高昂的情况是,一家公司必须以低廉的价格发行股票,永久地稀释股东的权益,以巩固其资产负债表。当然,债务的好处在于,它通常代表着廉价资本,特别是在代替具有高回报率的再投资能力的公司中。当我们考虑债务水平时,我们首先考虑现金和债务水平。
How Much Debt Does Coterra Energy Carry?
Coterra Energy 承载了多少负债?
You can click the graphic below for the historical numbers, but it shows that as of March 2024 Coterra Energy had US$2.65b of debt, an increase on US$2.18b, over one year. However, because it has a cash reserve of US$1.54b, its net debt is less, at about US$1.11b.
您可以点击下面的图表查看历史数据,但它显示,截至2024年3月,Coterra Energy的债务为26.5亿美元,比一年前的21.8亿美元增加了。但由于其有1.54亿美元的现金储备,其净债务只有约11.1亿美元。
![debt-equity-history-analysis](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240619/0-042563bbe5bf0e4a71a3b95b4f33599b-0-58864dacf5614621c739acdffca34fe0.png/big)
How Strong Is Coterra Energy's Balance Sheet?
Coterra Energy的资产负债表强度如何?
Zooming in on the latest balance sheet data, we can see that Coterra Energy had liabilities of US$1.71b due within 12 months and liabilities of US$6.15b due beyond that. On the other hand, it had cash of US$1.54b and US$878.0m worth of receivables due within a year. So its liabilities outweigh the sum of its cash and (near-term) receivables by US$5.44b.
在查看最新的资产负债表数据时,我们可以看到Coterra Energy在12个月内到期的负债为17.1亿美元,超过12个月到期的负债为61.5亿美元。另一方面,它有15.4亿美元的现金和8.78亿美元的应该于一年内到期的应收账款。所以它的负债比其现金和(短期)应收账款的总和多54.4亿美元。
Coterra Energy has a very large market capitalization of US$19.8b, so it could very likely raise cash to ameliorate its balance sheet, if the need arose. But we definitely want to keep our eyes open to indications that its debt is bringing too much risk.
Coterra Energy的市值非常大,为198亿美元,因此如果需要,它很可能筹集资金来改善其资产负债表。但我们肯定要密切关注它的债务带来的风险。
We use two main ratios to inform us about debt levels relative to earnings. The first is net debt divided by earnings before interest, tax, depreciation, and amortization (EBITDA), while the second is how many times its earnings before interest and tax (EBIT) covers its interest expense (or its interest cover, for short). Thus we consider debt relative to earnings both with and without depreciation and amortization expenses.
我们使用两个主要的比率来告诉我们相对于收益的债务水平。第一个是净债务除以利息、税、折旧和摊销前利润(EBITDA),而第二个是其利润前利息和税(EBIT)覆盖其利息费用的次数(或其利息覆盖率,简称)。因此,我们考虑与折旧和摊销费用相关的盈利以及没有相关费用的盈利相对于债务水平。
Coterra Energy's net debt is only 0.33 times its EBITDA. And its EBIT easily covers its interest expense, being 38.1 times the size. So you could argue it is no more threatened by its debt than an elephant is by a mouse. It is just as well that Coterra Energy's load is not too heavy, because its EBIT was down 68% over the last year. When it comes to paying off debt, falling earnings are no more useful than sugary sodas are for your health. When analysing debt levels, the balance sheet is the obvious place to start. But it is future earnings, more than anything, that will determine Coterra Energy's ability to maintain a healthy balance sheet going forward. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting.
Coterra Energy的净负债仅相当于其息税折旧及摊销前利润(EBITDA)的0.33倍。它的EBIT轻松覆盖其利息支出,规模为38.1倍。因此可以说,这个债务对于它的威胁不亚于老鼠对于大象。好在Coterra Energy的负担不太重,因为其EBIT在过去一年中下降了68%。而债务支付方面,萎靡的收益对你的健康同样毫无帮助。在分析债务水平时,资产负债表是显而易见的起点。但最终,未来的收益而不是任何其他因素,将决定Coterra Energy维持健康资产负债表的能力。因此,如果您想知道专业人士的看法,您可能会发现有关分析师利润预测的免费报告很有趣。
Finally, a company can only pay off debt with cold hard cash, not accounting profits. So we clearly need to look at whether that EBIT is leading to corresponding free cash flow. Over the most recent three years, Coterra Energy recorded free cash flow worth 69% of its EBIT, which is around normal, given free cash flow excludes interest and tax. This free cash flow puts the company in a good position to pay down debt, when appropriate.
最后,公司只能用冷酷的现金而不是会计利润来偿还债务。因此,我们显然需要查看这种EBIT是否带来相应的自由现金流。在过去的三年中,Coterra Energy记录的自由现金流价值为其EBIT的69%,这大约是正常水平,因为自由现金流不包括利息和税款。这笔自由现金流使得公司有能力在适当的时候偿还债务。
Our View
我们的观点
Based on what we've seen Coterra Energy is not finding it easy, given its EBIT growth rate, but the other factors we considered give us cause to be optimistic. In particular, we are dazzled with its interest cover. When we consider all the elements mentioned above, it seems to us that Coterra Energy is managing its debt quite well. But a word of caution: we think debt levels are high enough to justify ongoing monitoring. There's no doubt that we learn most about debt from the balance sheet. But ultimately, every company can contain risks that exist outside of the balance sheet. For instance, we've identified 3 warning signs for Coterra Energy that you should be aware of.
根据我们所看到的,Coterra Energy并不容易,考虑到其EBIT增长率,但我们考虑到的其他因素让我们有理由保持乐观。特别是,我们对其息税前利润覆盖率印象深刻。当我们考虑以上所有因素时,我们认为Coterra Energy在管理其债务方面做得相当好。但需要注意的是:我们认为债务水平足够高,需要持续监控。毫无疑问,我们从资产负债表中了解到债务的大部分情况。但最终,每家公司都可能存在超出资产负债表范围的风险。例如,我们已经找出了Coterra Energy的三个警告信号,这是您应该了解的。
Of course, if you're the type of investor who prefers buying stocks without the burden of debt, then don't hesitate to discover our exclusive list of net cash growth stocks, today.
当然,如果您是那种喜欢购买没有负债负担的股票的投资者,则今天就可以发现我们的独家净现金增长股清单。
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