Five Star Current Financial Leverage

FVVSF -  USA Stock  

USD 0.0274  0.0024  9.60%

Five Star's financial leverage is the degree to which the firm utilizes its fixed-income securities and uses equity to finance projects. Companies with high leverage are usually considered to be at financial risk. Five Star's financial risk is the risk to Five Star stockholders that is caused by an increase in debt. In other words, with a high degree of financial leverage come high-interest payments, which usually reduce Earnings Per Share (EPS).
Please check the analysis of Five Star Fundamentals Over Time.

FVVSF Bonds 

 
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Given the importance of Five Star's capital structure, the first step in the capital decision process is for the management of Five Star to decide how much external capital it will need to raise to operate in a sustainable way. Once the amount of financing is determined, management needs to examine the financial markets to determine the terms in which the company can boost capital. This move is crucial to the process because the market environment may reduce the ability of Five Star Diamonds to issue bonds at a reasonable cost.

Five Star Financial Leverage Rating

Five Star Diamonds bond ratings play a critical role in determining how much Five Star 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 Five Star's borrowing costs.
Overall Bond Rating
Not Rated
Average S&P Rating
N/A

Five Star Diamonds Debt to Cash Allocation

As Five Star Diamonds follows its natural business cycle, the capital allocation decisions will not magically go away. Five Star's decision-makers have to determine if most of the cash flows will be poured back into or reinvested in the business, reserved for other projects beyond operational needs, or paid back to stakeholders and investors. Many companies 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.
The company has accumulated 720.17 K in total debt with debt to equity ratio (D/E) of 0.11, which may suggest the company is not taking enough advantage from borrowing. Five Star Diamonds has a current ratio of 0.58, indicating that it has a negative working capital and may not be able to pay financial obligations in time and when they become due.

Five Star Assets Financed by Debt

Typically, companies with high debt-to-asset ratios are said to be highly leveraged. The higher the ratio, the greater risk will be associated with the Five Star's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Five Star, which in turn will lower the firm's financial flexibility. Like all other financial ratios, a a Five Star debt ratio should be compared their industry average or other competing firms.

Understaning Five Star Use of Financial Leverage

Five Star financial leverage ratio helps in determining the effect of debt on the overall profitability of the company. It measures Five Star'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 Five Star assets, the company is considered highly leveraged. Understanding the composition and structure of overall Five Star 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.
Please read more on our technical analysis page.
Aranjin Resources Ltd., together with its subsidiaries, engages in the exploration and development of mineral properties in Mongolia. Aranjin Resources Ltd. was incorporated in 2012 and is headquartered in Ulaanbaatar, Mongolia. Five Star is traded on OTC Exchange in the United States.

Five Star Investors Sentiment

The influence of Five Star's investor sentiment on the probability of its price appreciation or decline could be a good factor in your decision-making process regarding taking a position in FVVSF. The overall investor sentiment generally increases the direction of a stock movement in a one-year investment horizon. However, the impact of investor sentiment on the entire stock markets does not have a solid backing from leading economists and market statisticians.

Current Sentiment - FVVSF

Five Star Diamonds Investor Sentiment

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Please check the analysis of Five Star Fundamentals Over Time. Note that the Five Star Diamonds information on this page should be used as a complementary analysis to other Five Star's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.

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When running Five Star Diamonds price analysis, check to measure Five Star's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Five Star is operating at the current time. Most of Five Star's value examination focuses on studying past and present price action to predict the probability of Five Star's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Five Star's price. Additionally, you may evaluate how the addition of Five Star to your portfolios can decrease your overall portfolio volatility.
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The market value of Five Star Diamonds is measured differently than its book value, which is the value of FVVSF that is recorded on the company's balance sheet. Investors also form their own opinion of Five Star's value that differs from its market value or its book value, called intrinsic value, which is Five Star'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 Five Star's market value can be influenced by many factors that don't directly affect Five Star Diamonds underlying business (such as pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Five Star's value and its price as these two are different measures arrived at by different means. Investors typically determine Five Star value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Five Star'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.