These 4 Measures Indicate That Suzhou Shijing Environmental TechnologyLtd (SZSE:301030) Is Using Debt Extensively
These 4 Measures Indicate That Suzhou Shijing Environmental TechnologyLtd (SZSE:301030) Is Using Debt Extensively
Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility of prices, but whether you will suffer a permanent loss of capital.' 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. Importantly, Suzhou Shijing Environmental Technology Co.,Ltd. (SZSE:301030) does carry debt. But is this debt a concern to shareholders?
传奇基金经理李录(受查理·芒格支持)曾说:“最大的投资风险不是价格波动,而是你是否会遭受到资本的永久损失。”所以看起来明智的投资者知道,通常与破产有关的债务是评估一家公司风险的非常重要的因素。重要的是,苏州世晶环保科技股份有限公司(SZSE:301030)确实存在债务。但这种债务会不会对股东构成担忧呢?
Why Does Debt Bring Risk?
为什么债务会带来风险?
Debt is a tool to help businesses grow, but if a business is incapable of paying off its lenders, then it exists at their mercy. Ultimately, if the company can't fulfill its legal obligations to repay debt, shareholders could walk away with nothing. 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. 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 think about a company's use of debt, we first look at cash and debt together.
债务是帮助企业成长的工具,但如果企业无力偿还其债权人,则存在债权人的威胁。 最终,如果公司无法履行偿还债务的法律义务,股东可能会一无所获。 然而,更常见(但仍然昂贵)的情况是,公司必须以便宜的股价稀释股东,仅为了控制债务。 当然,债务的好处在于,它通常代表着廉价资本,尤其是当它取代具有以高回报率再投资能力的公司的稀释时。 当我们考虑公司使用债务时,我们首先考虑现金和债务。
How Much Debt Does Suzhou Shijing Environmental TechnologyLtd Carry?
苏州世晶环保王府井贵金属(SZSE:301030)负有多少债务?
The image below, which you can click on for greater detail, shows that at March 2024 Suzhou Shijing Environmental TechnologyLtd had debt of CN¥2.67b, up from CN¥1.78b in one year. On the flip side, it has CN¥1.00b in cash leading to net debt of about CN¥1.67b.
下面的图像可单击以查看更多详细信息,显示苏州世晶环保王府井贵金属于2024年3月的债务为26.7亿人民币,比一年前的17.8亿人民币增加。 另一方面,它拥有10亿人民币的现金,导致净债务约为16.7亿人民币。
![big](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240813/0-d157fb20449e3a37366d491402f833f9-0-928c05c1a99f92c43f60125dc81daa35.png/big)
How Strong Is Suzhou Shijing Environmental TechnologyLtd's Balance Sheet?
苏州世晶环保王府井贵金属的资产负债表有多强?
The latest balance sheet data shows that Suzhou Shijing Environmental TechnologyLtd had liabilities of CN¥5.03b due within a year, and liabilities of CN¥1.38b falling due after that. Offsetting this, it had CN¥1.00b in cash and CN¥2.84b in receivables that were due within 12 months. So its liabilities outweigh the sum of its cash and (near-term) receivables by CN¥2.56b.
最新的资产负债表数据显示,苏州世晶环保王府井贵金属有503亿人民币的短期负债和138亿人民币的逾期负债。与此相抵消的是,它拥有10亿人民币的现金和28.4亿人民币的应收账款,这些应收账款在12个月内到期。因此,它的负债超过了现金和(短期)应收账款的总和256亿人民币。
Suzhou Shijing Environmental TechnologyLtd has a market capitalization of CN¥4.97b, so it could very likely raise cash to ameliorate its balance sheet, if the need arose. But it's clear that we should definitely closely examine whether it can manage its debt without dilution.
苏州世晶环保王府井贵金属的市值为49.7亿人民币,因此,如果有需要,它可能非常可能筹集资金来改善其资产负债表。但显然,我们确实应该仔细检查它是否可以管理它的债务而不发生稀释。
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). 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).
我们通过查看净债务与利息、税、折旧和摊销前收益(EBITDA)之比以及计算其利息支出由收益前利息和税(EBIT)覆盖的程度来度量一家公司的债务负载相对于其收益能力的程度。此方法的优点在于我们同时考虑了债务的绝对量(以净债务为EBITDA)以及与该债务相关的实际利息支出(以其利息覆盖倍数计算)。
Suzhou Shijing Environmental TechnologyLtd has a debt to EBITDA ratio of 4.4 and its EBIT covered its interest expense 5.0 times. Taken together this implies that, while we wouldn't want to see debt levels rise, we think it can handle its current leverage. Importantly, Suzhou Shijing Environmental TechnologyLtd grew its EBIT by 89% over the last twelve months, and that growth will make it easier to handle its debt. The balance sheet is clearly the area to focus on when you are analysing debt. But ultimately the future profitability of the business will decide if Suzhou Shijing Environmental TechnologyLtd 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.
苏州世晶环保王府井贵金属的债务与EBITDA比率为4.4,EBIt覆盖了其利息开支5.0倍。 总之,这意味着,虽然我们不希望看到债务水平上升,但我们认为它可以处理其目前的杠杆作用。重要的是,苏州世晶环保王府井贵金属在过去12个月中增加了89%的EBIt增长率,这种增长将使其更容易处理其债务。资产负债表显然是分析债务的重点。但最终,企业未来的盈利能力将决定苏州世晶环保王府井贵金属能否随着时间的推移加强其资产负债表。因此,如果你关注未来,你可以查看这份免费的报告,其中显示了分析师的利润预测。
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. During the last three years, Suzhou Shijing Environmental TechnologyLtd burned a lot of cash. While that may be a result of expenditure for growth, it does make the debt far more risky.
最后,尽管税务机构可能会喜欢会计利润,但贷方只接受现金。 因此,我们清楚地需要看一下EBIt是否会导致相应的自由现金流量。 在过去三年中,苏州世晶环保王府井贵金属烧掉了大量现金。 尽管这可能是为了增长的支出,但它确实使债务风险更加严重。
Our View
我们的观点
Neither Suzhou Shijing Environmental TechnologyLtd's ability to convert EBIT to free cash flow nor its net debt to EBITDA gave us confidence in its ability to take on more debt. But its EBIT growth rate tells a very different story, and suggests some resilience. Taking the abovementioned factors together we do think Suzhou Shijing Environmental TechnologyLtd's debt poses some risks to the business. While that debt can boost returns, we think the company has enough leverage now. The balance sheet is clearly the area to focus on when you are analysing debt. But ultimately, every company can contain risks that exist outside of the balance sheet. For example Suzhou Shijing Environmental TechnologyLtd has 4 warning signs (and 3 which don't sit too well with us) we think you should know about.
苏州世晶环保王府井贵金属未能让我们对其承担更多债务的能力有信恳智能,但其EBIt增长率却讲述着一个截然不同的故事,并表明它具有一定的弹性。综合考虑这些因素,我们认为苏州世晶环保王府井贵金属的债务对该公司构成一些风险。尽管这种债务可能会推高收益,但我们认为该公司已经拥有足够的杠杆作用。资产负债表显然是分析债务的重点。但最终,每个公司都可能存在超出资产负债表之外的风险。例如,苏州世晶环保王府井贵金属存在4个警示信号(和3个与我们不太相关的问题)我们认为你应该知道。
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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