OneSpaWorld Story

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OSW -- USA Stock  

USD 8.63  0.44  4.85%

OneSpaWorld Holdings is scheduled to announce its earnings today. The next earnings report is expected on the 24th of February 2021. The stock still experiences an active downward rally. As many investors are getting excited about consumer cyclical space, it is fair to focus on OneSpaWorld Holdings Limited as an investment option. We will analyze why OneSpaWorld Holdings investors may still consider a stake in the business.
Published over two weeks ago
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Continue to hold OneSpaWorld (NASDAQ:OSW) based on its current debt obligations?
The company has 234.7 M in debt with debt to equity (D/E) ratio of 0.51, which is OK given its current industry classification. OneSpaWorld Holdings has a current ratio of 2.57, demonstrating that it is liquid and is capable to disburse its financial commitments when the payables are due. About 19.0% of the company outstanding shares are owned by corporate insiders. OneSpaWorld Holdings has price-to-book ratio of 1.17. Typically companies with comparable Price to Book (P/B) are able to outperform the market in the long run. The entity recorded a loss per share of 3.63. The firm last dividend was issued on the 8th of April 2020.
OneSpaWorld Holdings financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of OneSpaWorld Holdings, including all of OneSpaWorld 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 OneSpaWorld Holdings assets, the company is considered highly leveraged. Understanding the composition and structure of overall OneSpaWorld 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.

How important is OneSpaWorld Holdings's Liquidity

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

How OneSpaWorld utilizes its cash?

To perform a cash flow analysis of OneSpaWorld Holdings, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash OneSpaWorld Holdings is receiving and how much cash it distributes out in a given period. The OneSpaWorld Holdings cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Going after OneSpaWorld Financials

The entity reported the last year's revenue of 399.64 M. Reported Net Loss for the year was (226.56 M) with profit before taxes, overhead, and interest of 43.19 M.

Will OneSpaWorld Holdings fall back in December?

Latest market risk adjusted performance is at 0.37. OneSpaWorld Holdings Limited shows above-average downside volatility for the selected time horizon. We advise investors to inspect OneSpaWorld Holdings Limited further and ensure that all market timing and asset allocation strategies are consistent with the estimation of OneSpaWorld Holdings future alpha.

Our Final Perspective on OneSpaWorld Holdings

While some firms under the leisure industry are still a bit expensive, OneSpaWorld Holdings may offer a potential longer-term growth to sophisticated investors. Taking everything into account, as of the 11th of November 2020, we believe that at this point, OneSpaWorld Holdings is moderately volatile with below average probability of financial unrest within the next 2 years. From a slightly different point of view, the entity appears to be undervalued. Our concluding 30 days buy-sell recommendation on the venture is Cautious Hold.

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 Achuva Shats do not own shares of OneSpaWorld Holdings Limited. Please refer to our Terms of Use for any information regarding our disclosure principles.

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