FAT Brands Story

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FAT -- USA Stock  

USD 5.50  0.09  1.61%

The upcoming quarterly report is expected on the 5th of November 2020. The stock is currently undergoing an active upward rally. While many traders are getting carried away by overanalyzing consumer cyclical space, it is reasonable to review FAT Brands as an investment alternative. Here we also measure the ability of FAT Brands to meet its long-term debt obligations, such as interest payments on debt, the final principal payment on the debt, and any other fixed obligations like lease payments.
Published over a week ago
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What is November outlook for FAT Brands (NASDAQ:FAT)?
This firm has 62.88 M in debt. The company has a current ratio of 0.47, suggesting that it has not enough short term capital to pay financial commitments when the payables are due. We provide trade advice to complement the prevailing expert consensus on FAT Brands. Our dynamic recommendation engine uses a multidimensional algorithm to analyze the company's potential to grow using all technical and fundamental data available today.
FAT Brands financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of FAT Brands, including all of FAT Brands's 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 FAT Brands assets, the company is considered highly leveraged. Understanding the composition and structure of overall FAT Brands debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

Understanding FAT Brands Total Liabilities

FAT Brands liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. FAT Brands has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on FAT Brands balance sheet include debt obligations and money owed to different FAT Brands vendors, workers, and loan providers. Below is the chart of FAT Brands short long-term liabilities accounts currently reported on its balance sheet.
You can use FAT Brands financial leverage analysis tool to get a better grip on understanding its financial position

How important is FAT Brands's Liquidity

FAT Brands financial leverage refers to using borrowed capital as a funding source to finance FAT Brands ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. FAT Brands financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between FAT Brands's total debt and its cash.

Breaking down FAT Brands Further

FAT Brands reported the last year's revenue of 19.27 M. Reported Net Loss for the year was (6.42 M) with profit before taxes, overhead, and interest of 18.39 M.

Liabilities Breakdown

6.9 M
Current Liabilities
25.6 M
Long-Term Liabilities
Total Liabilities27.94 Million
Current Liabilities6.9 Million
Long-Term Liabilities25.59 Million

Are FAT Brands technical ratios showing a correction?

Newest jensen alpha is at 1.28. FAT Brands is displaying above-average volatility over the selected time horizon. Investors should scrutinize FAT Brands independently to ensure intended market timing strategies are aligned with expectations about FAT Brands volatility.

Our Conclusion on FAT Brands

Whereas some other entities under the restaurants industry are still a bit expensive, FAT Brands may offer a potential longer-term growth to private investors. With a less-than optimistic outlook for your 30 days horizon, it may be a good time to exit some or all of your FAT Brands holdings as it seems the potential growth was already fully factored into the current price. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to FAT Brands.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of FAT Brands. Please refer to our Terms of Use for any information regarding our disclosure principles.

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