Lightinthebox Holding currently holds 11.73
M in liabilities with Debt to Equity (D/E) ratio of 0.18, which may suggest Lightinthebox Holding is not taking enough advantage from borrowing. This firm has a current ratio of 0.74, indicating that it has a negative working capital and may not be able to pay financial obligations when due. Debt can assist Lightinthebox Holding until it has trouble settling it off, either with new capital or with free cash flow. So, Lightinthebox Holding'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 Lightinthebox Holding sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Lightinthebox to invest in growth at high rates of return. When we think about Lightinthebox Holding's use of debt, we should always consider it together with cash and equity.
LightInTheBox Holding financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of LightInTheBox Holding, including all of LightInTheBox Holding'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 LightInTheBox Holding assets, the company is considered highly leveraged. Understanding the
composition and structure of overall LightInTheBox Holding 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.
Watch out for price decline
Please consider monitoring LightInTheBox Holding on a daily basis if you are holding a position in it. LightInTheBox Holding is trading at a penny-stock level, and the possibility of delisting is much higher compared to other stocks. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion.
Most exchanges require public instruments, such as LightInTheBox Holding stock to be traded above the $1 level to remain listed. If LightInTheBox Holding stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.
Understanding LightInTheBox Total Debt
LightInTheBox Holding liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. LightInTheBox Holding 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 LightInTheBox Holding balance sheet include debt obligations and money owed to different LightInTheBox Holding vendors, workers, and loan providers. Below is the chart of LightInTheBox main long-term debt accounts currently reported on its balance sheet.
You can use LightInTheBox Holding Co
financial leverage analysis tool to get a better grip on understanding its financial position
How important is LightInTheBox Holding's Liquidity
LightInTheBox Holding
financial leverage refers to using borrowed capital as a funding source to finance LightInTheBox Holding Co ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. LightInTheBox Holding 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. Financial leverage can amplify the potential profits to LightInTheBox Holding'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 LightInTheBox Holding'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). Please check the
breakdown between LightInTheBox Holding's total debt and its cash.
Detailed Perspective On LightInTheBox Holding
The company reported the previous year's revenue of 446.1
M. Net Income was 13.13
M with profit before overhead, payroll, taxes, and interest of 206.71
M.
Liabilities Breakdown
25.5 M
Deposit Liabilities
95.3 M
Current Liabilities
| Deposit Liabilities | 25.51 Million |
| Total Liabilities | 108.99 Million |
| Current Liabilities | 95.32 Million |
| Long-Term Liabilities | 17.74 Million |
| Tax Liabilities | 12.14 Million |
Lightinthebox Holding is estimated to stay under $1.17 in July
Coefficient of variation is down to 2302.23. It may suggest a possible volatility slip. Lightinthebox Holding Co exhibits above-average semi-deviation for your current time horizon. We encourage investors to investigate Lightinthebox Holding Co individually to make sure intended market timing strategies and available technical indicagtors are consistent with their estimates about Lightinthebox Holding future systematic risk. Lightinthebox Holding Co is a potential penny stock. Although Lightinthebox Holding may be in fact a good instrument to invest, many penny stocks are speculative in nature and are subject to artificial price hype. Please make sure you totally understand the upside potential and downside risk of investing in Lightinthebox Holding Co. We encourage investors to look for the signals such us email spams, message board hypes, claims of breakthroughs, volume upswings, sudden news releases, promotions that are not reported, or demotions released before SEC filings. Please also check biographies and work history of current and past company officers before investing in high volatility instruments, penny stocks, or equities with microcap classification. You can indeed make money on Lightinthebox instrument if you perfectly time your entry and exit. However, remember that penny stocks that have been the subject of an artificial hype usually unable to maintain its increased share price for more than just a few days. The price of a promoted high volatility instrument will almost always revert back. The only way to increase shareholder value is through legitimate performance backed up by solid fundamentals.
Whereas some companies under the internet retail industry are still a bit expensive, Lightinthebox Holding may offer a potential longer-term growth to investors. The bottom line, as of the 14th of June 2022, we see that Lightinthebox Holding follows the market closely. The company is
undervalued with
very low odds of financial distress within the next 24 months. Our actual 90 days buy-hold-sell recommendation on the company is
Hold.
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Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time basis at the beginning of the pandemic and eventually acquired a real taste for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI.
View Profile 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 LightInTheBox Holding Co. Please refer to our
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