Grab Holdings Stock Story

GRAB
 Stock
  

USD 3.51  0.06  1.68%   

Grab Holdings is scheduled to announce its earnings today. The next financial report is expected on the 23rd of May 2022. While some millenniums are indifferent towards financial services space, it makes sense to go over Grab Holdings as a unique investment alternative. We will analyze why Grab Holdings investors may still consider a stake in the business.
Published over three months ago
View all stories for Grab Holdings | View All Stories

Will Grab Holdings (NASDAQ:GRAB) be in financial trouble before June?

Grab Holdings currently holds 13.95 B in liabilities with Debt to Equity (D/E) ratio of 0.27, which may suggest Grab Holdings is not taking enough advantage from borrowing. This firm has a current ratio of 6.19, suggesting that it is liquid enough and is able to pay its financial obligations when due. Debt can assist Grab Holdings until it has trouble settling it off, either with new capital or with free cash flow. So, Grab Holdings' 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 Grab Holdings sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Grab Holdings to invest in growth at high rates of return. When we think about Grab Holdings' use of debt, we should always consider it together with cash and equity.
Grab Holdings financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Grab Holdings, including all of Grab Holdings'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 Grab Holdings assets, the company is considered highly leveraged. Understanding the composition and structure of overall Grab Holdings 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 Grab Holdings Total Debt

Grab Holdings liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Grab Holdings 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 Grab Holdings balance sheet include debt obligations and money owed to different Grab Holdings vendors, workers, and loan providers. Below is the chart of Grab Holdings main long-term debt accounts currently reported on its balance sheet.
You can use Grab Holdings financial leverage analysis tool to get a better grip on understanding its financial position

How important is Grab Holdings's Liquidity

Grab Holdings financial leverage refers to using borrowed capital as a funding source to finance Grab Holdings ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Grab Holdings 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 Grab Holdings's total debt and its cash.

Breaking down Grab Holdings Indicators

The company reported the previous year's revenue of 787 M. Net Loss for the year was (2.61 B) with loss before overhead, payroll, taxes, and interest of (494 M).

Liabilities Breakdown

1.1 B
Current Liabilities
2.2 B
Long-Term Liabilities
Total Liabilities3.24 Billion
Current Liabilities1.05 Billion
Long-Term Liabilities2.19 Billion
Tax Liabilities4.98 Million

Are you still ambivalent about Grab Holdings?

Current market risk adjusted performance indicator falls down to -0.56. Possible price jump? Grab Holdings is displaying above-average volatility over the selected time horizon. Investors should scrutinize Grab Holdings independently to ensure intended market timing strategies are aligned with expectations about Grab Holdings volatility. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Grab Holdings' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Grab Holdings' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Grab Holdings Implied Volatility

Grab Holdings' implied volatility exposes the market's sentiment of Grab Holdings stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Grab Holdings' implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Grab Holdings stock will not fluctuate a lot when Grab Holdings' options are near their expiration.

Our Conclusion on Grab Holdings

Whereas other companies in the asset management industry are either recovering or due for a correction, Grab Holdings may not be as strong as the others in terms of longer-term growth potentials. To conclude, as of the 19th of May 2022, our analysis shows that Grab Holdings actively responds to the market. The company is undervalued and projects quite high odds of financial distress for the next 2 years. Our final 90 days buy vs. sell advice on the company is Cautious Hold.

Editorial Staff

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 Grab Holdings. Please refer to our Terms of Use for any information regarding our disclosure principles.

Would you like to provide feedback on the content of this article?

You can get in touch with us directly or send us a quick note via email to editors@macroaxis.com