Here's Why Commercial Metals (NYSE:CMC) Can Manage Its Debt Responsibly
Here's Why Commercial Metals (NYSE:CMC) Can Manage Its Debt Responsibly
Warren Buffett famously said, 'Volatility is far from synonymous with risk.' So it might be obvious that you need to consider debt, when you think about how risky any given stock is, because too much debt can sink a company. Importantly, Commercial Metals Company (NYSE:CMC) does carry debt. But the more important question is: how much risk is that debt creating?
當你考慮一個股票的風險時,需要考慮負債情況,因爲過高的負債可能會拖垮一家公司。商業金屬公司(NYSE:CMC)有負債,但更重要的問題是:這些債務造成多大風險?
What Risk Does Debt Bring?
債務帶來了什麼風險?
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. Part and parcel of capitalism is the process of 'creative destruction' where failed businesses are mercilessly liquidated by their bankers. 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. The first thing to do when considering how much debt a business uses is to look at its cash and debt together.
當債務和其他負債無法通過自由現金流或以有吸引力價格籌集資本來滿足並且無法進行有效清算時,它們會對公司造成風險。創業過程中必然會有“創造性破壞”的過程,即失敗的企業被銀行家無情地清算。然而,更頻繁但同樣昂貴的情況是,公司必須以極低的價格發行股票,永久性地稀釋股東資產,以穩固其資產負債表。當然,債務所帶來的好處是它通常代表了廉價的資本,尤其是在取代股權稀釋的情況下,公司能以高回報率重新投資。考慮一家企業使用多少債務時,首要要做的就是看看其現金和債務的總和。
What Is Commercial Metals's Net Debt?
商業金屬的淨債務是多少?
You can click the graphic below for the historical numbers, but it shows that Commercial Metals had US$1.05b of debt in February 2024, down from US$1.29b, one year before. On the flip side, it has US$638.3m in cash leading to net debt of about US$413.6m.
你可以點擊下面的圖表查看歷史數字,它顯示商業金屬在2024年2月有10.5億美元的債務,而一年前有12.9億美元的債務。相反,它有6.383億美元的現金,導致淨債務約爲4.136億美元。
![debt-equity-history-analysis](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240621/0-56324edf8521e91b0ad4d9e1458592a9-0-41ccc2fc4d020ea823f12d5229812d70.png/big)
How Strong Is Commercial Metals' Balance Sheet?
商業金屬的資產負債表有多強?
We can see from the most recent balance sheet that Commercial Metals had liabilities of US$762.5m falling due within a year, and liabilities of US$1.68b due beyond that. On the other hand, it had cash of US$638.3m and US$1.12b worth of receivables due within a year. So its liabilities total US$682.8m more than the combination of its cash and short-term receivables.
最新資產負債表顯示,商業金屬有7.625億美元的短期到期負債和16.8億美元的長期到期負債。另一方面,它有6.383億美元的現金和11.2億美元的短期應收賬款。所以它的負債總額比其現金和短期應收賬款的總和多了6.828億美元。
Given Commercial Metals has a market capitalization of US$5.87b, it's hard to believe these liabilities pose much threat. Having said that, it's clear that we should continue to monitor its balance sheet, lest it change for the worse.
鑑於商業金屬的市值爲58.7億美元,很難相信這些負債會帶來很大的威脅。但話說回來,很明顯我們應該繼續監測它的資產負債表,以防意外惡化。
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). Thus we consider debt relative to earnings both with and without depreciation and amortization expenses.
爲了對公司的債務相對於其收益進行規模適應,我們計算其淨債務與利息、稅、折舊和攤銷前收益(EBITDA)之比及其稅前收益(EBIT)與利息支出之比(利息保障倍數)。因此,我們既考慮到不包括折舊和攤銷費用在內的收益,又包括折舊和攤銷費用的收益相對於債務。
Commercial Metals has a low net debt to EBITDA ratio of only 0.35. And its EBIT covers its interest expense a whopping 23.0 times over. 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 Commercial Metals's load is not too heavy, because its EBIT was down 32% 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 ultimately the future profitability of the business will decide if Commercial Metals can strengthen its balance sheet over time. So if you're focused on the future you can check out this free report showing analyst profit forecasts.
商業金屬的淨債務與EBITDA比率僅爲0.35。其EBIT覆蓋其利息開支23.0倍之多。因此,你可以認爲它受到債務威脅就像大象受到老鼠的威脅一樣。商業金屬的EBIT在過去一年中下降了32%,這樣很明顯對償還債務來說並不有利。分析債務水平時,資產負債表是明顯的起點。但最終業務的未來盈利能力將決定商業金屬是否能隨着時間的推移加強其資產負債表。因此,如果你關注未來,可以查看這份免費報告,展示了分析師的利潤預測。
But our final consideration is also important, because a company cannot pay debt with paper profits; it needs cold hard cash. So it's worth checking how much of that EBIT is backed by free cash flow. In the last three years, Commercial Metals's free cash flow amounted to 40% of its EBIT, less than we'd expect. That's not great, when it comes to paying down debt.
但我們最後要考慮的也同樣重要,因爲公司無法用虛假的利潤來償還債務,它需要的是實打實的現金。因此,查看這些EBIT由多少自由現金流支持是值得的。在過去三年中,商業金屬的自由現金流僅佔其EBIT的40%,低於預期。在償還債務方面,這並不理想。
Our View
我們的觀點
Commercial Metals's EBIT growth rate was a real negative on this analysis, although the other factors we considered were considerably better. There's no doubt that its ability to to cover its interest expense with its EBIT is pretty flash. Looking at all this data makes us feel a little cautious about Commercial Metals's debt levels. While debt does have its upside in higher potential returns, we think shareholders should definitely consider how debt levels might make the stock more risky. When analysing debt levels, the balance sheet is the obvious place to start. However, not all investment risk resides within the balance sheet - far from it. For example, we've discovered 2 warning signs for Commercial Metals (1 shouldn't be ignored!) that you should be aware of before investing here.
商業金屬的EBIT增長率在本分析中的確受到負面影響,儘管我們考慮的其他因素要好得多。它的EBIT與利息費用的覆蓋率相當不錯。查看所有這些數據讓我們對商業金屬的債務水平感到有些謹慎。雖然債務確實有其上行潛力,但我們認爲股東應該注意債務水平可能使該股更具風險的因素。在分析債務水平時,資產負債表是明顯的起點。但並非所有投資風險都存於資產負債表之中——遠非如此。例如,我們發現了商業金屬投資的兩個警示信號(其中之一不應被忽略!),在進行投資之前應該注意這些。
When all is said and done, sometimes its easier to focus on companies that don't even need debt. Readers can access a list of growth stocks with zero net debt 100% free, right now.
說到底,有時更容易關注那些甚至不需要債務的公司。讀者可以免費查看零淨債務增長股票列表,立即獲得。
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
對本文有反饋?關於內容有所顧慮?直接和我們聯繫。或者,發送電子郵件至editorial-team (at) simplywallst.com。
這篇文章是Simply Wall St的一般性文章。我們根據歷史數據和分析師預測提供評論,只使用公正的方法論,我們的文章並不意味着提供任何金融建議。文章不構成買賣任何股票的建議,也不考慮您的目標或您的財務狀況。我們的目標是帶給您基本數據驅動的長期關注分析。請注意,我們的分析可能不考慮最新的價格敏感公司公告或定性材料。Simply Wall St沒有任何股票頭寸。
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
對本文有反饋?關於內容有所顧慮?直接和我們聯繫。或者發送電子郵件至editorial-team@simplywallst.com。