Is Mueller Water Products (NYSE:MWA) Using Too Much Debt?
Is Mueller Water Products (NYSE:MWA) Using Too Much Debt?
Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously said that 'Volatility is far from synonymous with risk.' When we think about how risky a company is, we always like to look at its use of debt, since debt overload can lead to ruin. We can see that Mueller Water Products, Inc. (NYSE:MWA) does use debt in its business. But the real question is whether this debt is making the company risky.
作为一名投资者,有些人认为,波动性而非债务是衡量风险的最佳方式,但沃伦·巴菲特曾经说过,“波动性远非风险的同义词”。考虑进行风险评估时,我们通常喜欢看企业的债务使用情况,因为债务过重可能导致破产。我们可以看到,mueller water products使用债务来开展业务,但真正的问题是,这种债务是否会让公司变得更加冒险。
Why Does Debt Bring Risk?
为什么债务会带来风险?
Debt assists a business until the business has trouble paying it off, either with new capital or with free cash flow. Part and parcel of capitalism is the process of 'creative destruction' where failed businesses are mercilessly liquidated by their bankers. However, a more usual (but still expensive) situation is where a company must dilute shareholders at a cheap share price simply to get debt under control. Having said that, the most common situation is where a company manages its debt reasonably well - and to its own advantage. The first thing to do when considering how much debt a business uses is to look at its cash and debt together.
债务有助于一家企业发展,直到企业无法依靠新的资本或自由现金流来偿还债务。资本主义的重要特点之一就是“创造性破坏”过程,失败的企业会被银行家无情地清算。然而,一种更常见(但仍然昂贵)的情况是公司必须以低廉的股价稀释股东来控制债务。尽管如此,最常见的情况是一家公司可以合理地管理其债务并从中获益。考虑企业使用多少债务时,与现金和债务一起看看。
How Much Debt Does Mueller Water Products Carry?
mueller water products负债情况如何?
As you can see below, Mueller Water Products had US$446.4m of debt, at March 2024, which is about the same as the year before. You can click the chart for greater detail. On the flip side, it has US$179.2m in cash leading to net debt of about US$267.2m.
如下所示,截至2024年3月,mueller water products的债务为44640万美元,与前一年相当。点击图表以获取更多信息。另一方面,其现金为17920万美元,净债务约为26720万美元。
![big](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240721/0-ef10fd39bc0a87f025288b9fe4de846e-0-38a99f8f410d86808872ddff113a7e03.png/big)
A Look At Mueller Water Products' Liabilities
根据最近的资产负债表,mueller water products的短期负债为21230万美元,长期负债为57260万美元。与此相对,它有17920万美元的现金和23210万美元的应收款项,应在12个月内到期。因此,其负债总额比其现金和短期应收款项的组合多37360万美元。
According to the last reported balance sheet, Mueller Water Products had liabilities of US$212.3m due within 12 months, and liabilities of US$572.6m due beyond 12 months. Offsetting this, it had US$179.2m in cash and US$232.1m in receivables that were due within 12 months. So its liabilities total US$373.6m more than the combination of its cash and short-term receivables.
当然,mueller water products的市值为3.07亿美元,所以这些负债可能是可以管理的。但负债仍然相当大,我们强烈建议股东继续关注公司的资产负债表。
Of course, Mueller Water Products has a market capitalization of US$3.07b, so these liabilities are probably manageable. But there are sufficient liabilities that we would certainly recommend shareholders continue to monitor the balance sheet, going forward.
mueller water products的净债务只有其EBITDA的1.2倍。其EBIT覆盖其利息费用的倍数高达11.9倍。因此,您可以认为它面临的债务威胁不比大象面临的老鼠威胁小。此外,mueller water products在过去的十二个月中增长了35%的EBIT,这种增长将使其更容易管理其债务。分析债务水平时,资产负债表是显而易见的起点。但归根结底,企业未来的盈利能力将决定mueller water products是否可以随着时间的推移加强其资产负债表。因此,如果您想了解专业人士的想法,您可能会发现分析师利润预测免费报告有趣。
In order to size up a company's debt relative to its earnings, we calculate its net debt divided by its earnings before interest, tax, depreciation, and amortization (EBITDA) and its earnings before interest and tax (EBIT) divided by its interest expense (its interest cover). The advantage of this approach is that we take into account both the absolute quantum of debt (with net debt to EBITDA) and the actual interest expenses associated with that debt (with its interest cover ratio).
为了评估公司的债务与收益的关系,我们计算净债务除以息税折旧及摊销前利润(EBITDA),以及利息费用除以息税前利润(EBIT)(其利息覆盖率)。这种方法的优点是我们同时考虑到债务的绝对量(以净债务/EBITDA计算),以及与债务相关的实际利息费用(以利息覆盖率计算)。
Mueller Water Products's net debt is only 1.2 times its EBITDA. And its EBIT covers its interest expense a whopping 11.9 times over. So you could argue it is no more threatened by its debt than an elephant is by a mouse. On top of that, Mueller Water Products grew its EBIT by 35% over the last twelve months, and that growth will make it easier to handle its debt. When analysing debt levels, the balance sheet is the obvious place to start. But ultimately the future profitability of the business will decide if Mueller Water Products can strengthen its balance sheet over time. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting.
最后,虽然税务机构可能喜欢会计利润,但放贷者只接受冰冷的现金。因此,检查多少EBIt由自由现金流支持很有价值。在过去的三年中,mueller water products的自由现金流占其EBIT的38%,低于预期水平。这种弱势现金转换使企业更难以处理债务。
Finally, while the tax-man may adore accounting profits, lenders only accept cold hard cash. So it's worth checking how much of that EBIT is backed by free cash flow. In the last three years, Mueller Water Products's free cash flow amounted to 38% of its EBIT, less than we'd expect. That weak cash conversion makes it more difficult to handle indebtedness.
mueller water products的EBIt增长率表明,它可以像Cristiano Ronaldo对付14岁守门员那样容易地处理其债务。但说实话,我们认为它将EBIT转化为自由现金流的能力有所削弱。考虑到以上各种因素,看起来mueller water products的债务使用相当合理。虽然带来了一些风险,但也可以增强股东的回报。如果我们发现mueller water products的内部人士最近购买了股票,我们会有动力进一步研究该股票。如果您也这样想,那么幸运的是,今天我们正在分享我们的报告,列出了最新的内部交易情况。
Our View
我们的观点
Mueller Water Products's EBIT growth rate suggests it can handle its debt as easily as Cristiano Ronaldo could score a goal against an under 14's goalkeeper. But truth be told we feel its conversion of EBIT to free cash flow does undermine this impression a bit. When we consider the range of factors above, it looks like Mueller Water Products is pretty sensible with its use of debt. While that brings some risk, it can also enhance returns for shareholders. We'd be motivated to research the stock further if we found out that Mueller Water Products insiders have bought shares recently. If you would too, then you're in luck, since today we're sharing our list of reported insider transactions for free.
mueller water products的EBIt增长率表明,它可以像Cristiano Ronaldo对付14岁守门员那样容易地处理其债务。但说实话,我们认为它将EBIT转化为自由现金流的能力有所削弱。考虑到以上各种因素,看起来mueller water products的债务使用相当合理。虽然带来了一些风险,但也可以增强股东的回报。如果我们发现mueller water products的内部人士最近购买了股票,我们会有动力进一步研究该股票。如果您也这样想,那么幸运的是,今天我们正在分享我们的报告,列出了最新的内部交易情况。
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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Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
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