ASX:KOR Historical Debt Feb 28th 18
More Is KOR’s debt level acceptable? KOR is a relatively highly levered company with a debt-to-equity of 64.93%. This is not unusual for small-caps as debt tends to be a cheaper and faster source of funding for some businesses. Though, since KOR is currently loss-making, sustainability of its current state of operations becomes a concern. Maintaining a high level of debt, while revenues are still below costs, can be dangerous as liquidity tends to dry up in unexpected downturns.
Next Steps: At its current level of cash flow coverage, KOR has room for improvement to better cushion for events which may require debt repayment. In addition to this, its low liquidity raises concerns over whether current asset management practices are properly implemented for the small-cap. This is only a rough assessment of financial health, and I’m sure KOR has company-specific issues impacting its capital structure decisions. You should continue to research Korab Resources to get a more holistic view of the stock by looking at the areas below. Just a heads up – to access some parts of the Simply Wall St research tool you might be asked to create a free account, but it takes just one click and the information they provide is definitely worth it in my opinion.
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.