Overview

​

The judicious use of a company's debt and equity is a key indicator of a strong balance sheet. A healthy capital structure that reflects a low level of debt and a large amount of equity is a positive sign of the quality of the investment.

​

By measuring: working capital, assets performance, and capital structure, we assess the strength of a company's balance sheet and, therefore, its performance.

​

Capital Structure is a type of financing that supports the growth of a company and related assets, it describes the combination of long-term capital, which is a combination of debt and equity. Through Capital Structure, we design a strategy tailored to your business to generate organic growth.

​

KEY TAKEAWAYS

​

• Capital structure is how a company funds its overall operations and growth.

• Equity is a company's common and preferred stock plus retained earnings.

• Debt typically includes short-term borrowing, long-term debt, and a portion of the principal amount of operating leases and redeemable preferred stock.

• Important ratios used to analyze capital structure include the debt ratio, the debt-to-equity ratio, and the long-term debt to capitalization ratio.

• The debt-to-equity (D/E) ratio is useful in determining the riskiness of a company's borrowing practices.

​

 

Investment thesis

​

​

​

​

Structuring process