Liabilities Breakdown
| Total Current Liabilities | 24.71 Million | |
| Liabilities And Stockholders Equity | 25.21 Million | |
| Non Current Liabilities Total | 1.9 Million | |
| Non Current Liabilities Other | 241,178 |
Will Wrap Technologies (USA Stocks:WRAP) be in financial trouble before October?
 | By Aina Ster | Macroaxis Story |
In the world of investing, timing can be everything. Wrap Technologies, a player in the electronic equipment and scientific instruments sector, has recently caught the eye of investors as it navigates through challenging financial waters. With a net income loss of 30.2M and total liabilities sitting at 25.3M, the company faces significant hurdles. However, analysts are optimistic, with target prices ranging from 2.28 to 2.78, suggesting potential for a rebound. As the market watches closely, understanding the underlying factors could be key for those looking to capitalize on Wrap's next moves. Wrap Technologies is set to release its earnings tomorrow, and there are some interesting trends to note. The company's Receivables Turnover has remained steady over the past year. As of September 22, 2024, the Graham Number is expected to rise to 1.46, while Days Sales Outstanding may decrease to 111.38. With growing interest from passive investors in the electronic equipment sector, Wrap Technologies could be an appealing option for those looking to dive in. However, I'll explore some reasons why retail investors may not currently hold this stock in high regard.
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Reviewed by Raphi Shpitalnik
Investors considering Wrap Technologies stock should be aware of its current challenges, including a net income loss of 30.2M and a free cash flow deficit of 17.3M, which may raise concerns about its financial stability. However, with a potential upside of 8.52, there could be significant opportunities for those willing to leverage their investments in anticipation of a market rebound.
Main Points
Wrap Technologies has $25.34 million in liabilities and a very low debt-to-equity ratio of 0.01, indicating that the company isn't leveraging debt much. With a current ratio of 12.5, it shows strong liquidity, meaning it can easily meet its financial obligations. It's important to consider Wrap's debt in the context of its cash and equity. Insiders own about 31% of the company's outstanding shares, which reflects confidence in its future. However, the company reported a loss of $0.72 per share and hasn't paid dividends in recent years. Additionally, Wrap Technologies underwent a 1-for-10 stock split on June 4, 2013, which may have affected its share price dynamics.Wrap Technologies financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Wrap Technologies, including all of Wrap Technologies's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Wrap Technologies assets, the company is considered highly leveraged. Understanding the composition and structure of overall Wrap Technologies debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.Watch out for price decline
Please consider monitoring Wrap Technologies on a daily basis if you are holding a position in it. Wrap Technologies is trading at a penny-stock level, and the possibility of delisting is much higher compared to other stocks. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion. Most exchanges require public instruments, such as Wrap Technologies stock to be traded above the $1 level to remain listed. If Wrap Technologies stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.
How important is Wrap Technologies's Liquidity
Wrap Technologies financial leverage refers to using borrowed capital as a funding source to finance Wrap Technologies ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Wrap Technologies financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Wrap Technologies' owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Wrap Technologies' financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Wrap Technologies's total debt and its cash.
Breaking down Wrap Technologies Indicators
Wrap Technologies reported the previous year's revenue of 6.13 M. Net Loss for the year was (30.22 M) with profit before overhead, payroll, taxes, and interest of 3.73 M.
In the world of investing, timing can be everything.Wrap Technologies, operating in the scientific and technical instruments sector, is currently facing significant challenges, with a net income loss of 30.2 million and an operating income loss of 18.7 million. Despite these hurdles, the company holds 4 million in cash and has a potential upside of 8.52, suggesting that there may be room for recovery. With a debt-to-equity ratio of just 0.01%, Wrap appears to be in a relatively stable position regarding leverage, which could attract investors looking for a rebound opportunity. However, the high probability of bankruptcy at 95.46% raises caution, making it essential for potential investors to weigh the risks carefully before diving in..
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