Puhui Wealth Current Financial Leverage

PHCF -  USA Stock  

USD 3.75  0.08  2.09%

Puhui Wealth'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. Puhui Wealth's financial risk is the risk to Puhui Wealth 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 Puhui Wealth Fundamentals Over Time.

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Given the importance of Puhui Wealth's capital structure, the first step in the capital decision process is for the management of Puhui Wealth 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 Puhui Wealth Investment to issue bonds at a reasonable cost.

Puhui Wealth Financial Leverage Rating

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

Puhui Wealth Investment Debt to Cash Allocation

As Puhui Wealth Investment follows its natural business cycle, the capital allocation decisions will not magically go away. Puhui Wealth'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 2.61 M in liabilities with Debt to Equity (D/E) ratio of 0.36, which is about average as compared to similar companies. Puhui Wealth Investment has a current ratio of 1.72, which is within standard range for the sector.

Puhui Wealth 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 Puhui Wealth's operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Puhui Wealth, which in turn will lower the firm's financial flexibility. Like all other financial ratios, a a Puhui Wealth debt ratio should be compared their industry average or other competing firms.

Puhui Wealth Investment Historical Debt Patterns

Understaning Puhui Wealth Use of Financial Leverage

Puhui Wealth financial leverage ratio helps in determining the effect of debt on the overall profitability of the company. It measures Puhui Wealth'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 Puhui Wealth assets, the company is considered highly leveraged. Understanding the composition and structure of overall Puhui Wealth 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.
Puhui Wealth Investment Management Co., Ltd., through its subsidiaries, provides third-party wealth management services in the Peoples Republic of China. The company was founded in 2013 and is headquartered in Beijing, China. Puhui Wealth operates under Asset Management classification in the United States and is traded on NASDAQ Exchange. It employs 73 people.

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Please check the analysis of Puhui Wealth Fundamentals Over Time. Note that the Puhui Wealth Investment information on this page should be used as a complementary analysis to other Puhui Wealth'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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.

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When running Puhui Wealth Investment price analysis, check to measure Puhui Wealth'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 Puhui Wealth is operating at the current time. Most of Puhui Wealth's value examination focuses on studying past and present price action to predict the probability of Puhui Wealth's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Puhui Wealth's price. Additionally, you may evaluate how the addition of Puhui Wealth to your portfolios can decrease your overall portfolio volatility.
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The market value of Puhui Wealth Investment is measured differently than its book value, which is the value of Puhui that is recorded on the company's balance sheet. Investors also form their own opinion of Puhui Wealth's value that differs from its market value or its book value, called intrinsic value, which is Puhui Wealth'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 Puhui Wealth's market value can be influenced by many factors that don't directly affect Puhui Wealth Investment 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 Puhui Wealth's value and its price as these two are different measures arrived at by different means. Investors typically determine Puhui Wealth value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Puhui Wealth'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.