Is AAR (NYSE:AIR) Using Too Much Debt?
Is AAR (NYSE:AIR) Using Too Much Debt?
David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the permanent loss of capital.' 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 note that AAR Corp. (NYSE:AIR) does have debt on its balance sheet. But is this debt a concern to shareholders?
大卫·伊本(David Iben)说得很好:“我们不关心波动性,我们关心的是避免永久性的资本损失。”当我们考虑一家公司的风险性时,我们总是喜欢看它的债务使用情况,因为债务过载可能导致灭亡。我们注意到AAR Corp.(纽交所:AIR)的资产负债表上确实有债务。但这个债务是否让股东担忧呢?
Why Does Debt Bring Risk?
为什么债务会带来风险?
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. If things get really bad, the lenders can take control of the business. 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. By replacing dilution, though, debt can be an extremely good tool for businesses that need capital to invest in growth at high rates of return. The first step when considering a company's debt levels is to consider its cash and debt together.
当一个企业无法轻松地通过自由现金流或以诱人的价格融资来履行债务和其他负债时,债务和其他负债会对企业产生风险。如果情况变得非常糟糕,债权人可以接管企业。然而,一个更常见(但仍然昂贵)的情况是,一家公司必须以廉价的股票价格稀释股东,以控制债务。然而,通过债务取代稀释,债务可以成为需要资本投资高回报增长的企业的极好工具。考虑一家公司的债务水平时的第一步是考虑其现金和债务的总和。
What Is AAR's Net Debt?
AAR的净债务是多少?
You can click the graphic below for the historical numbers, but it shows that as of May 2024 AAR had US$985.4m of debt, an increase on US$269.7m, over one year. However, because it has a cash reserve of US$85.8m, its net debt is less, at about US$899.6m.
您可以点击下面的图表查看历史数字,但它显示截至2024年5月,AAR公司负债为98540万美元,较去年增加26970万美元。然而,由于其现金储备为8580万美元,其净债务较少,约为89960万美元。
![1725015387469](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240830/43122623-0-f99e0d3186e4da06d6b48113b378b5fd.webp/bigjpg)
How Healthy Is AAR's Balance Sheet?
AAR的资产负债表有多健康?
We can see from the most recent balance sheet that AAR had liabilities of US$466.9m falling due within a year, and liabilities of US$1.11b due beyond that. Offsetting this, it had US$85.8m in cash and US$423.6m in receivables that were due within 12 months. So it has liabilities totalling US$1.07b more than its cash and near-term receivables, combined.
我们可以从最近的资产负债表看出,AAR到期的负债有46690万美元,而到期日超过一年的负债有11.1亿美元。相应的,它有8580万美元现金和42360万美元应于12个月内到期的应收账款。所以,它的负债总额比其现金和短期应收账款总额多107亿美元。
While this might seem like a lot, it is not so bad since AAR has a market capitalization of US$2.27b, and so it could probably strengthen its balance sheet by raising capital if it needed to. But it's clear that we should definitely closely examine whether it can manage its debt without dilution.
虽然这可能看起来很多,但并不算太糟,因为AAR的市值为22.7亿美元,因此如果需要的话,它可能通过筹集资本来加强其资产负债表。但很明显,我们绝对需要仔细调查它是否能够管理好债务而不用发行新股。
We measure a company's debt load relative to its earnings power by looking at its net debt divided by its earnings before interest, tax, depreciation, and amortization (EBITDA) and by calculating how easily its earnings before interest and tax (EBIT) cover its interest expense (interest cover). Thus we consider debt relative to earnings both with and without depreciation and amortization expenses.
通过查看公司的净债务与利息、税、折旧、摊销前利润(EBITDA)之比以及它的利息费用(利息覆盖率)可以衡量一个公司的债务负担与收益能力。因此,我们考虑将债务与有无计算折旧和摊销费用的收益相对比。
AAR's debt is 4.4 times its EBITDA, and its EBIT cover its interest expense 4.0 times over. This suggests that while the debt levels are significant, we'd stop short of calling them problematic. On a slightly more positive note, AAR grew its EBIT at 18% over the last year, further increasing its ability to manage debt. There's no doubt that we learn most about debt from the balance sheet. But it is future earnings, more than anything, that will determine AAR'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.
AAR的债务是其息税折旧及摊销前利润(EBITDA)的4.4倍,其EBIT可以覆盖其利息开支的4.0倍。这表明尽管其债务水平是巨大的,但我们不会认为其成为问题。稍微更积极的是,AAR在过去一年内的EBIT增长了18%,进一步增强了其管理债务的能力。毫无疑问,我们最多可以从资产负债表中了解债务情况。但最终决定AAR未来能否保持健康资产负债表的是未来的盈利。所以,如果您想了解专业人士的看法,您可能会对此免费的分析师利润预测报告感兴趣。
Finally, while the tax-man may adore accounting profits, lenders only accept cold hard cash. So we clearly need to look at whether that EBIT is leading to corresponding free cash flow. Over the last three years, AAR reported free cash flow worth 16% of its EBIT, which is really quite low. That limp level of cash conversion undermines its ability to manage and pay down debt.
最后,虽然税务局可能喜欢会计利润,但放贷人只接受冷硬现金。所以我们清楚地需要看看EBIT是否会转化为相应的自由现金流。在过去三年中,AAR报告的自由现金流相当于其EBIT的16%,这实际上非常低。这种低水平的现金转化削弱了其管理和偿还债务的能力。
Our View
我们的观点
Both AAR's net debt to EBITDA and its conversion of EBIT to free cash flow were discouraging. At least its EBIT growth rate gives us reason to be optimistic. When we consider all the factors discussed, it seems to us that AAR is taking some risks with its use of debt. So while that leverage does boost returns on equity, we wouldn't really want to see it increase from here. There's no doubt that we learn most about debt from the balance sheet. However, not all investment risk resides within the balance sheet - far from it. To that end, you should learn about the 4 warning signs we've spotted with AAR (including 1 which is potentially serious) .
AAR公司的净债务/息税折旧及摊销前利润和息税折旧及摊销前利润转化为自由现金流的表现令人泄气。至少其息税折旧及摊销前利润增长率让我们有理由乐观。当我们考虑所有讨论的因素时,我们认为AAR公司在债务使用方面承担了一些风险。因此,虽然杠杆确实能提高资产回报率,但我们不希望看到它从这里增加。毫无疑问,我们最了解债务情况的地方是资产负债表。然而,并非所有的投资风险都存在于资产负债表内,相反。为此,您应该了解我们发现的AAR公司的4个警示信号(其中一个可能很严重)。
At the end of the day, it's often better to focus on companies that are free from net debt. You can access our special list of such companies (all with a track record of profit growth). It's free.
归根结底,专注于没有净债务的公司往往更好。您可以访问我们的特别列表,其中包括所有表现出盈利增长轨迹的公司。这是免费的。
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