APPLE HOSPITALITY REIT APPLE Bond
| 48T Stock | EUR 15.08 0.24 1.57% |
APPLE HOSPITALITY REIT holds a debt-to-equity ratio of 0.589. . APPLE HOSPITALITY's financial risk is the risk to APPLE HOSPITALITY stockholders that is caused by an increase in debt.
APPLE |
Given the importance of APPLE HOSPITALITY's capital structure, the first step in the capital decision process is for the management of APPLE HOSPITALITY to decide how much external capital it will need to raise to operate in a sustainable way. Once the amount of financing is determined, management needs to examine the financial markets to determine the terms in which the company can boost capital. This move is crucial to the process because the market environment may reduce the ability of APPLE HOSPITALITY REIT to issue bonds at a reasonable cost.
| Popular Name | APPLE HOSPITALITY APPLE INC |
| Equity ISIN Code | US03784Y2000 |
| Bond Issue ISIN Code | US037833DQ02 |
| S&P Rating | Others |
| Maturity Date | 11th of September 2049 |
| Issuance Date | 11th of September 2019 |
| Coupon | 2.95 % |
APPLE HOSPITALITY REIT Outstanding Bond Obligations
Understaning APPLE HOSPITALITY Use of Financial Leverage
APPLE HOSPITALITY's financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures APPLE HOSPITALITY's total debt position, including all outstanding debt obligations, and compares it with APPLE HOSPITALITY's equity. Financial leverage can amplify the potential profits to APPLE HOSPITALITY's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if APPLE HOSPITALITY is unable to cover its debt costs.
is a publicly traded real estate investment trust that owns one of the largest and most diverse portfolios of upscale, rooms-focused hotels in the United States. Concentrated with industry-leading brands, the Companys portfolio consists of 104 Marriott-branded hotels, 126 Hilton-branded hotels, three Hyatt-branded hotels and two independent hotels. APPLE HOSPITALITY operates under REITHotel Motel classification in Germany and is traded on Frankfurt Stock Exchange. It employs 66 people. Please read more on our technical analysis page.
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Additional Information and Resources on Investing in APPLE Stock
When determining whether APPLE HOSPITALITY REIT is a strong investment it is important to analyze APPLE HOSPITALITY's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact APPLE HOSPITALITY's future performance. For an informed investment choice regarding APPLE Stock, refer to the following important reports:Check out the analysis of APPLE HOSPITALITY Fundamentals Over Time. You can also try the Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
What is Financial Leverage?
Financial leverage is the use of borrowed money (debt) to finance the purchase of assets with the expectation that the income or capital gain from the new asset will exceed the cost of borrowing. In most cases, the debt provider will limit how much risk it is ready to take and indicate a limit on the extent of the leverage it will allow. In the case of asset-backed lending, the financial provider uses the assets as collateral until the borrower repays the loan. In the case of a cash flow loan, the general creditworthiness of the company is used to back the loan. The concept of leverage is common in the business world. It is mostly used to boost the returns on equity capital of a company, especially when the business is unable to increase its operating efficiency and returns on total investment. Because earnings on borrowing are higher than the interest payable on debt, the company's total earnings will increase, ultimately boosting stockholders' profits.Leverage and Capital Costs
The debt to equity ratio plays a role in the working average cost of capital (WACC). The overall interest on debt represents the break-even point that must be obtained to profitability in a given venture. Thus, WACC is essentially the average interest an organization owes on the capital it has borrowed for leverage. Let's say equity represents 60% of borrowed capital, and debt is 40%. This results in a financial leverage calculation of 40/60, or 0.6667. The organization owes 10% on all equity and 5% on all debt. That means that the weighted average cost of capital is (.4)(5) + (.6)(10) - or 8%. For every $10,000 borrowed, this organization will owe $800 in interest. Profit must be higher than 8% on the project to offset the cost of interest and justify this leverage.Benefits of Financial Leverage
Leverage provides the following benefits for companies:- Leverage is an essential tool a company's management can use to make the best financing and investment decisions.
- It provides a variety of financing sources by which the firm can achieve its target earnings.
- Leverage is also an essential technique in investing as it helps companies set a threshold for the expansion of business operations. For example, it can be used to recommend restrictions on business expansion once the projected return on additional investment is lower than the cost of debt.