Martin Marietta Debt
| MLM Stock | USD 552.72 1.85 0.34% |
Martin Marietta Materials holds a debt-to-equity ratio of 0.784. At this time, Martin Marietta's Interest Debt Per Share is very stable compared to the past year. As of the 10th of June 2024, Total Debt To Capitalization is likely to grow to 0.43, while Net Debt To EBITDA is likely to drop 1.66. . Martin Marietta's financial risk is the risk to Martin Marietta stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Martin Marietta's liquidity is one of the most fundamental aspects of both its future profitability and its ability to meet different types of ongoing financial obligations. Martin Marietta's cash, liquid assets, total liabilities, and shareholder equity can be utilized to evaluate how much leverage the Company is using to sustain its current operations. For traders, higher-leverage indicators usually imply a higher risk to shareholders. In addition, it helps Martin Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Martin Marietta's stakeholders.
Martin Marietta Quarterly Net Debt |
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For most companies, including Martin Marietta, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Martin Marietta Materials, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Martin Marietta's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Price Book 4.6338 | Book Value 143.981 | Operating Margin 0.0895 | Profit Margin 0.3136 | Return On Assets 0.0608 |
Given that Martin Marietta's debt-to-equity ratio measures a Company's obligations relative to the value of its net assets, it is usually used by traders to estimate the extent to which Martin Marietta is acquiring new debt as a mechanism of leveraging its assets. A high debt-to-equity ratio is generally associated with increased risk, implying that it has been aggressive in financing its growth with debt. Another way to look at debt-to-equity ratios is to compare the overall debt load of Martin Marietta to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, Martin Marietta is said to be less leveraged. If creditors hold a majority of Martin Marietta's assets, the Company is said to be highly leveraged.
At this time, Martin Marietta's Total Current Liabilities is very stable compared to the past year. As of the 10th of June 2024, Liabilities And Stockholders Equity is likely to grow to about 16.3 B, though Change To Liabilities is likely to grow to (34.1 M). Martin |
Martin Marietta Bond Ratings
Martin Marietta Materials financial ratings play a critical role in determining how much Martin Marietta have to pay to access credit markets, i.e., the amount of interest on their issued debt. The threshold between investment-grade and speculative-grade ratings has important market implications for Martin Marietta's borrowing costs.| Piotroski F Score | 5 | Healthy | View |
| Beneish M Score | (2.48) | Unlikely Manipulator | View |
Martin Marietta Materials Debt to Cash Allocation
Many companies such as Martin Marietta, eventually find out that there is only so much market out there to be conquered, and adding the next product or service is only half as profitable per unit as their current endeavors. Eventually, the company will reach a point where cash flows are strong, and extra cash is available but not fully utilized. In this case, the company may start buying back its stock from the public or issue more dividends.
Martin Marietta Materials has 4.92 B in debt with debt to equity (D/E) ratio of 0.78, which is OK given its current industry classification. Martin Marietta Materials has a current ratio of 1.97, which is typical for the industry and considered as normal. Note however, debt could still be an excellent tool for Martin to invest in growth at high rates of return. Martin Marietta Total Assets Over Time
Martin Marietta Assets Financed by Debt
The debt-to-assets ratio shows the degree to which Martin Marietta uses debt to finance its assets. It includes both long-term and short-term borrowings maturing within one year. It also includes both tangible and intangible assets, such as goodwill.Martin Marietta Debt Ratio | 25.0 |
Martin Marietta Corporate Bonds Issued
Martin Marietta issues bonds to finance its operations. Corporate bonds make up one of the most significant components of the U.S. bond market and are considered the world's largest securities market. Martin Marietta Materials uses the proceeds from bond sales for a wide variety of purposes, including financing ongoing mergers and acquisitions, buying new equipment, investing in research and development, buying back their own stock, paying dividends to shareholders, and even refinancing existing debt.
Martin Short Long Term Debt Total
Short Long Term Debt Total |
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Understaning Martin Marietta Use of Financial Leverage
Martin Marietta financial leverage ratio helps in determining the effect of debt on the overall profitability of the company. It measures Martin Marietta's total debt position, including all of outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Martin Marietta assets, the company is considered highly leveraged. Understanding the composition and structure of overall Martin Marietta debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business and if it is worth investing in it. Financial leverage can amplify the potential profits to Martin Marietta's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Martin Marietta's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets).
| Last Reported | Projected for Next Year | ||
| Short and Long Term Debt Total | 4.9 B | 5.2 B | |
| Net Debt | 3.6 B | 3.8 B | |
| Short Term Debt | 473 M | 496.6 M | |
| Long Term Debt | 3.9 B | 4.1 B | |
| Long Term Debt Total | 5 B | 5.2 B | |
| Short and Long Term Debt | 399.6 M | 322 M | |
| Net Debt To EBITDA | 1.72 | 1.66 | |
| Debt To Equity | 0.55 | 0.73 | |
| Interest Debt Per Share | 74.14 | 77.85 | |
| Debt To Assets | 0.29 | 0.25 | |
| Long Term Debt To Capitalization | 0.33 | 0.29 | |
| Total Debt To Capitalization | 0.35 | 0.43 | |
| Debt Equity Ratio | 0.55 | 0.73 | |
| Debt Ratio | 0.29 | 0.25 | |
| Cash Flow To Debt Ratio | 0.35 | 0.41 |
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Additional Information and Resources on Investing in Martin Stock
When determining whether Martin Marietta Materials is a strong investment it is important to analyze Martin Marietta's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Martin Marietta's future performance. For an informed investment choice regarding Martin Stock, refer to the following important reports:Check out the analysis of Martin Marietta Fundamentals Over Time. You can also try the Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Is Construction Materials space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Martin Marietta. If investors know Martin will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Martin Marietta listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 7.658 | Dividend Share 2.88 | Earnings Share 34.04 | Revenue Per Share 107.953 | Quarterly Revenue Growth (0.08) |
The market value of Martin Marietta Materials is measured differently than its book value, which is the value of Martin that is recorded on the company's balance sheet. Investors also form their own opinion of Martin Marietta's value that differs from its market value or its book value, called intrinsic value, which is Martin Marietta's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Martin Marietta's market value can be influenced by many factors that don't directly affect Martin Marietta's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Martin Marietta's value and its price as these two are different measures arrived at by different means. Investors typically determine if Martin Marietta is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Martin Marietta's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
What is Financial Leverage?
Financial leverage is the use of borrowed money (debt) to finance the purchase of assets with the expectation that the income or capital gain from the new asset will exceed the cost of borrowing. In most cases, the debt provider will limit how much risk it is ready to take and indicate a limit on the extent of the leverage it will allow. In the case of asset-backed lending, the financial provider uses the assets as collateral until the borrower repays the loan. In the case of a cash flow loan, the general creditworthiness of the company is used to back the loan. The concept of leverage is common in the business world. It is mostly used to boost the returns on equity capital of a company, especially when the business is unable to increase its operating efficiency and returns on total investment. Because earnings on borrowing are higher than the interest payable on debt, the company's total earnings will increase, ultimately boosting stockholders' profits.Leverage and Capital Costs
The debt to equity ratio plays a role in the working average cost of capital (WACC). The overall interest on debt represents the break-even point that must be obtained to profitability in a given venture. Thus, WACC is essentially the average interest an organization owes on the capital it has borrowed for leverage. Let's say equity represents 60% of borrowed capital, and debt is 40%. This results in a financial leverage calculation of 40/60, or 0.6667. The organization owes 10% on all equity and 5% on all debt. That means that the weighted average cost of capital is (.4)(5) + (.6)(10) - or 8%. For every $10,000 borrowed, this organization will owe $800 in interest. Profit must be higher than 8% on the project to offset the cost of interest and justify this leverage.Benefits of Financial Leverage
Leverage provides the following benefits for companies:- Leverage is an essential tool a company's management can use to make the best financing and investment decisions.
- It provides a variety of financing sources by which the firm can achieve its target earnings.
- Leverage is also an essential technique in investing as it helps companies set a threshold for the expansion of business operations. For example, it can be used to recommend restrictions on business expansion once the projected return on additional investment is lower than the cost of debt.