Henry Schein Current Financial Leverage
| HSIC Stock | USD 73.21 0.45 0.62% |
Henry Schein holds a debt-to-equity ratio of 0.288. At present, Henry Schein's Net Debt is projected to increase significantly based on the last few years of reporting. The current year's Short Term Debt is expected to grow to about 518.7 M, whereas Long Term Debt Total is forecasted to decline to about 732.8 M. Henry Schein's financial risk is the risk to Henry Schein 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).
Asset vs Debt
Equity vs Debt
Henry Schein'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. Henry Schein'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 Henry Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Henry Schein's stakeholders.
For most companies, including Henry Schein, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for the executing running Henry Schein the most critical issue when dealing with liquidity needs is whether the current assets are properly aligned with its current liabilities. If not, management will need to obtain alternative financing to ensure that there are always enough cash equivalents on the balance sheet in reserve to pay for obligations.
Price Book 2.4962 | Book Value 28.279 | Operating Margin 0.0139 | Profit Margin 0.0337 | Return On Assets 0.0453 |
Henry |
Henry Schein Financial Leverage Rating
Henry Schein bond ratings play a critical role in determining how much Henry Schein 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 Henry Schein's borrowing costs.| Piotroski F Score | 4 Poor |
| Beneish M Score | -1.93 Possible Manipulator |
Henry Schein Debt to Cash Allocation
As Henry Schein follows its natural business cycle, the capital allocation decisions will not magically go away. Henry Schein'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 currently holds 2.74 B in liabilities with Debt to Equity (D/E) ratio of 0.29, which may suggest the company is not taking enough advantage from borrowing. Henry Schein has a current ratio of 1.8, which is within standard range for the sector. Debt can assist Henry Schein until it has trouble settling it off, either with new capital or with free cash flow. So, Henry Schein's shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Henry Schein sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Henry to invest in growth at high rates of return. When we think about Henry Schein's use of debt, we should always consider it together with cash and equity.Henry Schein Total Assets Over Time
Henry Schein 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 Henry Schein's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Henry Schein, which in turn will lower the firm's financial flexibility. Like all other financial ratios, a a Henry Schein debt ratio should be compared their industry average or other competing firms.Henry Short Long Term Debt Total
Short Long Term Debt Total |
|
Understaning Henry Schein Use of Financial Leverage
Henry Schein financial leverage ratio helps in determining the effect of debt on the overall profitability of the company. It measures Henry Schein'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 Henry Schein assets, the company is considered highly leveraged. Understanding the composition and structure of overall Henry Schein 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 Henry Schein'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 Henry Schein'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 | 2.7 B | 2.9 B | |
| Net Debt | 2.6 B | 2.7 B | |
| Short Term Debt | 494 M | 518.7 M | |
| Long Term Debt | 1.9 B | 2 B | |
| Long Term Debt Total | 1.2 B | 732.8 M | |
| Short and Long Term Debt | 414 M | 251.7 M | |
| Net Debt To EBITDA | 1.12 | 0.76 | |
| Debt To Equity | 0.50 | 0.43 | |
| Interest Debt Per Share | 10.19 | 10.70 | |
| Debt To Assets | 0.20 | 0.18 | |
| Long Term Debt To Capitalization | 0.32 | 0.24 | |
| Total Debt To Capitalization | 0.35 | 0.29 | |
| Debt Equity Ratio | 0.50 | 0.43 | |
| Debt Ratio | 0.20 | 0.18 | |
| Cash Flow To Debt Ratio | 0.36 | 0.40 |
Henry Schein Investors Sentiment
The influence of Henry Schein'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 Henry. 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 market does not have solid backing from leading economists and market statisticians.
Investor biases related to Henry Schein's public news can be used to forecast risks associated with an investment in Henry. The trend in average sentiment can be used to explain how an investor holding Henry can time the market purely based on public headlines and social activities around Henry Schein. Please note that most equities that are difficult to arbitrage are affected by market sentiment the most.
Henry Schein's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Henry Schein's and other traded tickers. The bigger the bubble, the more accurate is the estimated score. Higher bars for a given day show more participation in the average Henry Schein's news discussions. The higher the estimated score, the more favorable is the investor's outlook on Henry Schein.
Some investors attempt to determine whether the market's mood is bullish or bearish by monitoring changes in market sentiment. Unlike more traditional methods such as technical analysis, investor sentiment usually refers to the aggregate attitude towards Henry Schein in the overall investment community. So, suppose investors can accurately measure the market's sentiment. In that case, they can use it for their benefit. For example, some tools to gauge market sentiment could be utilized using contrarian indexes, Henry Schein's short interest history, or implied volatility extrapolated from Henry Schein options trading.
Building efficient market-beating portfolios requires time, education, and a lot of computing power!
The Portfolio Architect is an AI-driven system that provides multiple benefits to our users by leveraging cutting-edge machine learning algorithms, statistical analysis, and predictive modeling to automate the process of asset selection and portfolio construction, saving time and reducing human error for individual and institutional investors.
Try AI Portfolio ArchitectCheck out the analysis of Henry Schein Fundamentals Over Time. For information on how to trade Henry Stock refer to our How to Trade Henry Stock guide.You can also try the Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Complementary Tools for Henry Stock analysis
When running Henry Schein's price analysis, check to measure Henry Schein'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 Henry Schein is operating at the current time. Most of Henry Schein's value examination focuses on studying past and present price action to predict the probability of Henry Schein's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Henry Schein's price. Additionally, you may evaluate how the addition of Henry Schein to your portfolios can decrease your overall portfolio volatility.
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| CEOs Directory Screen CEOs from public companies around the world |
Is Henry Schein's industry 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 Henry Schein. If investors know Henry 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 Henry Schein 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 (0.62) | Earnings Share 3.16 | Revenue Per Share 94.466 | Quarterly Revenue Growth (0.10) | Return On Assets 0.0453 |
The market value of Henry Schein is measured differently than its book value, which is the value of Henry that is recorded on the company's balance sheet. Investors also form their own opinion of Henry Schein's value that differs from its market value or its book value, called intrinsic value, which is Henry Schein'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 Henry Schein's market value can be influenced by many factors that don't directly affect Henry Schein'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 Henry Schein's value and its price as these two are different measures arrived at by different means. Investors typically determine if Henry Schein is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Henry Schein'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.