Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously said that 'Volatility is far from synonymous with risk.' It's only natural to consider a company's balance sheet when you examine how risky it is, since debt is often involved when a business collapses. We note that BioLife Solutions, Inc. (NASDAQ:BLFS) does have debt on its balance sheet. But is this debt a concern to shareholders?
What Risk Does Debt Bring?
Debt is a tool to help businesses grow, but if a business is incapable of paying off its lenders, then it exists at their mercy. 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, the upside of debt is that it often represents cheap capital, especially when it replaces dilution in a company with the ability to reinvest at high rates of return. The first step when considering a company's debt levels is to consider its cash and debt together.
See our latest analysis for BioLife Solutions
How Much Debt Does BioLife Solutions Carry?
The image below, which you can click on for greater detail, shows that BioLife Solutions had debt of US$7.55m at the end of June 2022, a reduction from US$11.3m over a year. But on the other hand it also has US$46.5m in cash, leading to a US$39.0m net cash position.
NasdaqCM:BLFS Debt to Equity History August 20th 2022
How Healthy Is BioLife Solutions' Balance Sheet?
We can see from the most recent balance sheet that BioLife Solutions had liabilities of US$33.3m falling due within a year, and liabilities of US$24.8m due beyond that. Offsetting these obligations, it had cash of US$46.5m as well as receivables valued at US$31.3m due within 12 months. So it actually has US$19.7m more liquid assets than total liabilities.
This short term liquidity is a sign that BioLife Solutions could probably pay off its debt with ease, as its balance sheet is far from stretched. Succinctly put, BioLife Solutions boasts net cash, so it's fair to say it does not have a heavy debt load! When analysing debt levels, the balance sheet is the obvious place to start. But it is future earnings, more than anything, that will determine BioLife Solutions'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.
Over 12 months, BioLife Solutions reported revenue of US$148m, which is a gain of 100%, although it did not report any earnings before interest and tax. Shareholders probably have their fingers crossed that it can grow its way to profits.
So How Risky Is BioLife Solutions?
Statistically speaking companies that lose money are riskier than those that make money. And we do note that BioLife Solutions had an earnings before interest and tax (EBIT) loss, over the last year. Indeed, in that time it burnt through US$27m of cash and made a loss of US$94m. With only US$39.0m on the balance sheet, it would appear that its going to need to raise capital again soon. BioLife Solutions's revenue growth shone bright over the last year, so it may well be in a position to turn a profit in due course. By investing before those profits, shareholders take on more risk in the hope of bigger rewards. When analysing debt levels, the balance sheet is the obvious place to start. However, not all investment risk resides within the balance sheet - far from it. For example, we've discovered 3 warning signs for BioLife Solutions that you should be aware of before investing here.
At the end of the day, it's often better to focus on companies that are free from net debt. You can access our special list of such companies (all with a track record of profit growth). It's free.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
一些人説,作為投資者,考慮風險的最佳方式是波動性,而不是債務,但巴菲特曾説過一句名言:波動性遠非風險的同義詞。當你考察一家公司的風險有多大時,考慮它的資產負債表是很自然的,因為當一家企業倒閉時,債務往往會涉及到它。我們注意到生物生命解決方案公司納斯達克(Sequoia Capital:BLFS)的資產負債表上確實有債務。但這筆債務對股東來説是一個擔憂嗎?
債務會帶來什麼風險?
債務是幫助企業發展的一種工具,但如果一家企業無法償還貸款人的債務,那麼它就只能聽從貸款人的擺佈。如果情況真的變得很糟糕,貸款人可以控制業務。儘管這並不常見,但我們確實經常看到負債累累的公司永久性地稀釋股東的權益,因為貸款人迫使他們以令人沮喪的價格籌集資金。當然,債務的好處是,它往往代表着廉價資本,特別是當它用能夠以高回報率進行再投資的能力取代公司的稀釋時。在考慮一家公司的債務水平時,第一步是同時考慮其現金和債務。
查看我們對BioLife解決方案的最新分析
BioLife Solutions揹負着多少債務?
下圖(您可以單擊查看更多詳細信息)顯示,截至2022年6月底,BioLife Solutions的債務為755萬美元,低於一年內的1130萬美元。但另一方面,它也擁有4650萬美元的現金,導致淨現金頭寸為3900萬美元。
納斯達克CM:BLFS債轉股歷史2022年8月20日
BioLife Solutions的資產負債表有多健康?
從最近的資產負債表中我們可以看到,BioLife Solutions有3330萬美元的債務在一年內到期,還有2480萬美元的債務在這之後到期。為了抵消這些債務,它有4650萬美元的現金以及價值3130萬美元的應收賬款在12個月內到期。所以它實際上有1970萬美元更多流動資產超過總負債。
這種短期流動性是一個跡象,表明BioLife Solutions可能會輕鬆償還債務,因為其資產負債表遠未捉襟見肘。簡而言之,BioLife Solutions擁有淨現金,所以公平地説,它沒有沉重的債務負擔!在分析債務水平時,資產負債表顯然是一個起點。但最重要的是未來的收益將決定BioLife Solutions未來保持健康資產負債表的能力。所以,如果你關注未來,你可以看看這個免費顯示分析師利潤預測的報告。
在過去的12個月裏,BioLife Solutions報告的收入為1.48億美元,增長了100%,儘管它沒有報告任何息税前收益。股東們可能會祈禱它能以自己的方式增長並實現盈利。
那麼,BioLife Solutions的風險有多大呢?
從統計上講,虧損的公司比賺錢的公司風險更大。我們確實注意到,BioLife Solutions在過去一年中出現了息税前收益(EBIT)虧損。事實上,在此期間,它燒掉了2700萬美元的現金,虧損了9400萬美元。在資產負債表上只有3900萬美元的情況下,它似乎很快就需要再次籌集資金。過去一年,BioLife Solutions的收入增長十分亮眼,因此它很可能在適當的時候扭虧為盈。通過在這些利潤之前投資,股東承擔了更大的風險,希望獲得更大的回報。在分析債務水平時,資產負債表顯然是一個起點。然而,並非所有投資風險都存在於資產負債表中--遠非如此。例如,我們發現生物生命解決方案的3個警告信號在這裏投資之前你應該意識到這一點。
歸根結底,關注那些沒有淨債務的公司往往更好。你可以訪問我們的這類公司的特別名單(都有利潤增長的記錄)。這是免費的。
對這篇文章有什麼反饋嗎?擔心內容嗎? 保持聯繫直接與我們聯繫。或者,也可以給編輯組發電子郵件,地址是implywallst.com。
本文由Simply Wall St.撰寫,具有概括性。我們僅使用不偏不倚的方法提供基於歷史數據和分析師預測的評論,我們的文章並不打算作為財務建議。它不構成買賣任何股票的建議,也沒有考慮你的目標或你的財務狀況。我們的目標是為您帶來由基本面數據驅動的長期重點分析。請注意,我們的分析可能不會將最新的對價格敏感的公司公告或定性材料考慮在內。Simply Wall St.對上述任何一隻股票都沒有持倉。