Will Superconductor (OTC:SCON) be in financial trouble before December?
 | By Ellen Johnson | Macroaxis Story |
Superconductor Techn is scheduled to announce its earnings today. While some of us are becoming more enthusiastic about technology space, let's outline Superconductor in greater detail to make a better estimate of its debt utilization. Let's try to inspect if Superconductor shares are reasonably priced going into December.
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Reviewed by Michael Smolkin
The company has a current ratio of 4.65, suggesting that it is liquid enough and is able to pay its financial obligations when due. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Superconductor has an asset utilization ratio of 5.07 percent. This suggests that the company is making $0.0507 for each dollar of assets. An increasing asset utilization means that Superconductor is more efficient with each dollar of assets it utilizes for everyday operations.
How important is Superconductor Technologies's Liquidity
Superconductor Technologies financial leverage refers to using borrowed capital as a funding source to finance Superconductor Technologies ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Superconductor Technologies 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 Superconductor Technologies' 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 Superconductor Technologies' 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 Superconductor Technologies's total debt and its cash.
A Deeper look at Superconductor
Superconductor Techn reported the previous year's revenue of 729 K. Net Loss for the year was (6.13 M) with loss before overhead, payroll, taxes, and interest of (3.02 M).
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