Is Karelian Diamond Resources plc’s (LON:KDR) Balance Sheet A Threat To Its Future?

Is KDR’s debt level acceptable?

KDR’s level of debt is low relative to its total equity, at 1.67%. KDR is not taking on too much debt commitment, which may be constraining for future growth. Risk around debt is extremely low for KDR, and the company also has the ability and headroom to increase debt if needed going forward.

Next Steps:

Although KDR’s debt level is relatively low, its cash flow levels still could not copiously cover its borrowings. This may indicate room for improvement in terms of its operating efficiency. Though, the company will be able to pay all of its upcoming liabilities from its current short-term assets. I admit this is a fairly basic analysis for KDR’s financial health. Other important fundamentals need to be considered alongside. I suggest you continue to research Karelian Diamond Resources to get a more holistic view of the stock by looking at:

1. Historical Performance: What has KDR’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.