ASX:KAS Historical Debt Nov 22nd 17
Can KAS meet its short-term obligations with the cash in hand?
At the current liabilities level of A$3M liabilities, it seems that the business is not able to meet these obligations given the level of current assets of A$2M, with a current ratio of 0.74x below the prudent level of 3x.
Does KAS face the risk of succumbing to its debt-load?
With a debt-to-equity ratio of 22.12%, KAS’s debt level may be seen as prudent. This range is considered safe as KAS is not taking on too much debt obligation, which may be constraining for future growth. Investors’ risk associated with debt is very low with KAS, and the company has plenty of headroom and ability to raise debt should it need to in the future.
Next Steps:
Are you a shareholder? KAS’s low debt is also met with low coverage. This indicates room for improvement as its cash flow covers less than a quarter of its borrowings, which means its operating efficiency could be better. Furthermore, the company may struggle to meet its near term liabilities should an adverse event occur. Given that its financial position may change. You should always be keeping on top of market expectations for KAS’s future growth on our free analysis platform.
Are you a potential investor? KAS appears to have maintained a sensible level of debt, which means there’s still some headroom to grow debt funding. But its current cash flow coverage of existing debt, along with its low liquidity, is concerning. However, keep in mind that this is a point-in-time analysis, and today’s performance may not be representative of KAS’s track record. I encourage you to continue your research by taking a look at KAS’s past performance analysis on our free platform to figure out KAS’s financial health position.
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.