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These 4 Measures Indicate That American Water Works Company (NYSE:AWK) Is Using Debt Extensively

These 4 Measures Indicate That American Water Works Company (NYSE:AWK) Is Using Debt Extensively

這4項措施表明美國自來水公司(紐約證券交易所代碼:AWK)正在廣泛使用債務
Simply Wall St ·  05/22 19:41

Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility of prices, but whether you will suffer a permanent loss of capital.' When we think about how risky a company is, we always like to look at its use of debt, since debt overload can lead to ruin. Importantly, American Water Works Company, Inc. (NYSE:AWK) does carry debt. But the real question is whether this debt is making the company risky.

傳奇基金經理李露(由查理·芒格支持)曾經說過:“最大的投資風險不是價格的波動,而是你是否會遭受永久的資本損失。”當我們考慮一家公司的風險時,我們總是喜歡考慮其債務的用途,因爲債務過載可能導致破產。重要的是,美國自來水公司(紐約證券交易所代碼:AWK)確實有債務。但真正的問題是這筆債務是否使公司面臨風險。

What Risk Does Debt Bring?

債務會帶來什麼風險?

Debt assists a business until the business has trouble paying it off, either with new capital or with free cash flow. If things get really bad, the lenders can take control of the business. While that is not too common, we often do see indebted companies permanently diluting shareholders because lenders force them to raise capital at a distressed price. Of course, debt can be an important tool in businesses, particularly capital heavy businesses. The first thing to do when considering how much debt a business uses is to look at its cash and debt together.

債務可以幫助企業,直到企業難以償還債務,無論是新資本還是自由現金流。如果情況變得非常糟糕,貸款人可以控制業務。儘管這種情況並不常見,但我們經常會看到負債公司永久稀釋股東,因爲貸款人迫使他們以不良价格籌集資金。當然,債務可以成爲企業的重要工具,尤其是資本密集型企業。在考慮企業使用多少債務時,要做的第一件事是同時考慮其現金和債務。

How Much Debt Does American Water Works Company Carry?

美國自來水公司揹負了多少債務?

You can click the graphic below for the historical numbers, but it shows that as of March 2024 American Water Works Company had US$13.1b of debt, an increase on US$11.2b, over one year. However, it also had US$656.0m in cash, and so its net debt is US$12.5b.

你可以點擊下圖查看歷史數字,但它顯示,截至2024年3月,美國自來水公司在一年內有131億美元的債務,比112億美元有所增加。但是,它也有6.56億美元的現金,因此其淨負債爲125億美元。

debt-equity-history-analysis
NYSE:AWK Debt to Equity History May 22nd 2024
紐約證券交易所:AWK 債務與股本比率歷史記錄 2024 年 5 月 22 日

How Strong Is American Water Works Company's Balance Sheet?

美國自來水公司的資產負債表有多強?

The latest balance sheet data shows that American Water Works Company had liabilities of US$1.86b due within a year, and liabilities of US$19.2b falling due after that. Offsetting this, it had US$656.0m in cash and US$665.5m in receivables that were due within 12 months. So its liabilities total US$19.8b more than the combination of its cash and short-term receivables.

最新的資產負債表數據顯示,美國自來水公司的負債爲18.6億美元,此後到期的負債爲192億美元。與此相抵消的是,它有6.56億美元的現金和6.65億美元的應收賬款將在12個月內到期。因此,其負債總額比其現金和短期應收賬款的總和高出198億美元。

This deficit is considerable relative to its very significant market capitalization of US$26.0b, so it does suggest shareholders should keep an eye on American Water Works Company's use of debt. This suggests shareholders would be heavily diluted if the company needed to shore up its balance sheet in a hurry.

與其260億美元的巨大市值相比,這一赤字相當可觀,因此這確實表明股東應密切關注美國自來水公司的債務使用情況。這表明,如果公司需要迅速支撐資產負債表,股東將被嚴重稀釋。

In order to size up a company's debt relative to its earnings, we calculate its net debt divided by its earnings before interest, tax, depreciation, and amortization (EBITDA) and its earnings before interest and tax (EBIT) divided by its interest expense (its interest cover). The advantage of this approach is that we take into account both the absolute quantum of debt (with net debt to EBITDA) and the actual interest expenses associated with that debt (with its interest cover ratio).

爲了擴大公司相對於收益的負債規模,我們計算其淨負債除以利息、稅項、折舊和攤銷前的收益(EBITDA),將其利息和稅前收益(EBIT)除以利息支出(利息保障)。這種方法的優勢在於,我們既考慮了債務的絕對數量(包括淨負債與息稅折舊攤銷前利潤),也考慮了與該債務相關的實際利息支出(及其利息覆蓋率)。

American Water Works Company has a rather high debt to EBITDA ratio of 5.5 which suggests a meaningful debt load. But the good news is that it boasts fairly comforting interest cover of 4.1 times, suggesting it can responsibly service its obligations. On a slightly more positive note, American Water Works Company grew its EBIT at 13% over the last year, further increasing its ability to manage debt. When analysing debt levels, the balance sheet is the obvious place to start. But it is future earnings, more than anything, that will determine American Water Works Company's ability to maintain a healthy balance sheet going forward. So if you're focused on the future you can check out this free report showing analyst profit forecasts.

美國自來水公司的債務與息稅折舊攤銷前利潤的比率相當高,爲5.5,這表明債務負擔相當可觀。但好消息是,它擁有相當令人欣慰的4.1倍的利息保障,這表明它可以負責任地履行其義務。稍微樂觀的一面是,美國自來水公司的息稅前利潤比去年增長了13%,進一步提高了其管理債務的能力。在分析債務水平時,資產負債表是顯而易見的起點。但是,未來收益將決定美國自來水公司未來維持健康資產負債表的能力。因此,如果您專注於未來,可以查看這份顯示分析師利潤預測的免費報告。

Finally, a business needs free cash flow to pay off debt; accounting profits just don't cut it. So it's worth checking how much of that EBIT is backed by free cash flow. During the last three years, American Water Works Company burned a lot of cash. While investors are no doubt expecting a reversal of that situation in due course, it clearly does mean its use of debt is more risky.

最後,企業需要自由現金流來償還債務;會計利潤根本無法減少債務。因此,值得檢查一下息稅前利潤中有多少是由自由現金流支持的。在過去的三年中,美國自來水公司消耗了大量現金。儘管投資者無疑預計這種情況將在適當的時候逆轉,但這顯然意味着其使用債務的風險更大。

Our View

我們的觀點

To be frank both American Water Works Company's net debt to EBITDA and its track record of converting EBIT to free cash flow make us rather uncomfortable with its debt levels. But on the bright side, its EBIT growth rate is a good sign, and makes us more optimistic. We should also note that Water Utilities industry companies like American Water Works Company commonly do use debt without problems. Overall, we think it's fair to say that American Water Works Company has enough debt that there are some real risks around the balance sheet. If all goes well, that should boost returns, but on the flip side, the risk of permanent capital loss is elevated by the debt. The balance sheet is clearly the area to focus on when you are analysing debt. However, not all investment risk resides within the balance sheet - far from it. To that end, you should learn about the 2 warning signs we've spotted with American Water Works Company (including 1 which is a bit unpleasant) .

坦率地說,美國自來水公司的淨負債與息稅折舊攤銷前利潤的比率及其將息稅前利潤轉換爲自由現金流的往績都使我們對其債務水平感到相當不舒服。但好的一面是,其息稅前利潤增長率是一個好兆頭,也使我們更加樂觀。我們還應該注意,像美國自來水公司這樣的水務行業公司通常會毫無問題地使用債務。總體而言,我們認爲可以公平地說,美國自來水公司的債務足以使資產負債表存在一些實際風險。如果一切順利,這應該會提高回報,但另一方面,債務會增加永久資本損失的風險。資產負債表顯然是分析債務時需要關注的領域。但是,並非所有的投資風險都存在於資產負債表中,遠非如此。爲此,你應該了解我們在美國自來水公司發現的兩個警告標誌(包括一個有點不愉快的警告)。

If you're interested in investing in businesses that can grow profits without the burden of debt, then check out this free list of growing businesses that have net cash on the balance sheet.

如果你有興趣投資能夠在沒有債務負擔的情況下增加利潤的企業,請查看這份資產負債表上有淨現金的成長型企業的免費清單。

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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Simply Wall St的這篇文章本質上是籠統的。我們僅使用公正的方法根據歷史數據和分析師的預測提供評論,我們的文章無意作爲財務建議。它不構成買入或賣出任何股票的建議,也沒有考慮到您的目標或財務狀況。我們的目標是爲您提供由基本數據驅動的長期重點分析。請注意,我們的分析可能不考慮最新的價格敏感型公司公告或定性材料。簡而言之,華爾街沒有持有任何上述股票的頭寸。

譯文內容由第三人軟體翻譯。


以上內容僅用作資訊或教育之目的,不構成與富途相關的任何投資建議。富途竭力但無法保證上述全部內容的真實性、準確性和原創性。
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