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Investment Technology Group Inc (ITG) Has Negative Growth

November 25th, 2012 Posted by Investment Valuation No Comment yet

Investment Technology Group Inc (ITG) is a financial services company based in the United States.  ITG is a  multinational agency brokerage and financial markets technology and was founded in 1983.

ITG Value Investing Approach  

This model is prepared in a very simple and easy way to value a company, it adopts the investment style of the Father of Value Investing Benjamin Graham. Graham believed in fundamental analysis and was looking for companies with a sound balance sheet and with little debt. The basis for this valuation is the company’s five years of historical financial records, the balance sheet, income statement, and cash flow statement. I calculated first the enterprise value as our first step. I believed this is important because it measures the total value of the company.

The Investment in Enterprise Value   

The concept of enterprise value is to calculate what it would cost to purchase an entire business. Enterprise Value EV) is the present value of the entire company.  Market capitalization is the total value of the company’s equity shares. In essence, it is a company’s theoretical takeover price, because the buyer would have to buy all of the stock and pay off existing debt, and taking any remaining cash.
Enterprise Value = Market Capitalization + Total Debt – (Cash and Cash Equivalent + Short Term Investment)

ITG EV

Looking closer at the table above, the market capitalization for ITG decreased at a rate of 53 percent in 2008 and 24 percent average thereafter. Total debt represented 12 percent average, while cash and cash equivalent represented 42 percent average of the enterprise value. Thus, enterprise value was lesser by 30 percent against market value. buying the entire business of ITG will be paying 100 percent of its equity, Purchasing the entire business of  Investment Technology Group to date, November 12, 2012, will cost $75 at $1.92 per share. The current market price to date is $7.86 per share.

Benjamin Graham’s Stock Test

Net Current Asset Value (NCAV) Approach   

The Net Current Asset Value (NCAV) is a method from Benjamin Graham to identify whether the stock is trading below the company’s net current asset value per share, specifically two-thirds or 66 percent of net current asset value. Meaning they are essentially trading below the company’s liquidation value and therefore, the stocks is trading in a bargain, and it is worth buying.

Net Current Asset Value (NCAV) Method      

ITG NCAVPS

The net asset current value approach indicates that the price of Investment Technology Group was overvalued because the market price was greater than the 66 percent ratio of NCAVPS. The stock price of ITG was expensive from 2007 until the trailing twelve months (6) 2012.

Market Capitalization/Net Current Asset Value (MC/NCAV) Valuation   

Another stock test by Graham is by using market capitalization and dividing it to net current asset value (NCAV).  The idea is, if the result does not exceed the ratio of 1.2, then the stock passes the test for buying. So, let us see if the stock of VSEC passed the test.

  ITG MC NCAV

The MC/NCAV indicates that the stock price was overvalued from 2007 to 2012 because the ratio exceeded the 1.2 ratios. Hence, the price of Investment Technology Group was expensive and therefore, didn’t pass the stock test.

Benjamin Graham’s Margin of Safety (MOS)  

The margin of safety is used to identify the difference between company value and price. Value investing is based on the assumption that two values are attached to all companies, the market price and the company’s business value or true value. Graham called it the intrinsic value. According to Graham, the investor should invest only if the market price is trading at a discount to its intrinsic value. Value investing is buying with a sufficient margin of safety. Graham considers buying when the market price is considerably lower than the intrinsic or real value, a minimum of 40 to 50 percent below. The enterprise value is used because I think it is a much more accurate measure of the company’s true market value than market capitalization.

ITG MOS

Explanation

Benjamin Graham’s margin of safety indicates a 61 percent average for Investment Technology Group, while in the trailing twelve months (6) 2012 it has a margin of safety at 99 percent.  Intrinsic value was $144 average.

The formula: Intrinsic Value =  Current Earnings x (9 + 2 x Sustainable  Growth Rate)  

wherein;

EPS: the company’s last 12-month earnings per share,  G: the company’s long-term (five years) sustainable growth estimate,  9: the constant represents the appropriate P-E ratio for a no-growth company as proposed by Graham (Graham  proposed an 8.5, but we changed it to 9), and 2: the average yield of high-grade corporate bonds.

ITG IV

Earnings per share (EPS) and the sustainable growth rate (SGR) factors intrinsic value.

EPS

Sustainable Growth Rate (SGR)

Sustainable growth rate (SGR), on the other hand, shows how fast a company can grow using internally generated assets without issuing additional debt or equity. To calculate the sustainable growth rate for a company, you need to know its return on equity (ROE). You also need to know the dividend payout ratio. From there, multiply the company’s ROE by its plow back ratio, which is equal to 1 minus the dividend-payout ratio.

    ITG SGR

Explanation

The average return on equity was -4.34, the ratio was negative because the ROE ratio for 2011 and the ttm6 was negative also due to negative net earnings during these periods. There was no payout ratio because the company is not paying cash dividends to its common shareholders.

There are also two approaches to calculating the sustainable growth rate. These are by using the relative ROE and the average ROE. Changes in approach also affect the results of intrinsic value and the margin of safety. To understand further, the results of these two approaches were summarized in the table below.

ITG Relative

Explanation

The intrinsic value line dropped in 2009 at a rate of 82 percent and started to rise again in 2010 at 57 percent. Then it continued to soar up very high in 2011 and the ttm9 2012 at a rate of 1947 percent and 175 percent, respectively. The financials of ITG showed zero earning from 2008 until 2011 and during the ttm6 2012, its net earnings were -57 percent.  This is the reason why in ttm6 the IV line soared up very high because the loss was great. On the other hand, EV line was deteriorating in value at a rate of 37 percent average.

ITG Graph

For the Investment Technology Group, there was a zero margin of safety during 2010 because EV line was higher than the IV line. Converting the space in value or in percentage, we get an average of 61 percent and this is the margin of safety. MOS is the result of subtracting the intrinsic value against the enterprise value.

ITG Relative Valuation Methods  

Relative valuation methods for valuing a stock is to compare the market values of the stock with the fundamentals (earnings, book value, growth multiples, cash flow, and other metrics) of the stock.

Price to Earnings/Earning Per Share (P/E*EPS)   

This valuation will help us understand whether stocks are undervalued or overvalued. To get the answer, we simply multiply the price to earnings (P/E) ratio with the company’s relative earning per share (EPS) and comparing it to the enterprise value per share, we can determine the status of the stock price.

ITG PE EPS

It indicates that the price was overvalued in 2007 because the enterprise value was greater than the P/E*EPS ratio. In 2008 to 2012, the price was undervalued because enterprise value was lesser than the P/E*EPS ratio. The enterprise value was 74 percent average of the P/E*EPS ratio. Overall, the P/E*EPS valuation indicates that the Investment Technology Group price was cheap.

The Relative and Average Approach

Another approach in calculating this ratio is by using the average price to earnings ratio.

ITG Relative PE

The relative ratio approach for ITG has a lower price to earnings ratio than the average price to earnings ratio. The average percentage for P/E*EPS in 2011 was -1427 percent. This is the reason why the percentage in the average approach was negative.

The Enterprise Value (EV)/Earning Per Share (EPS) or (EV/EPS)      

The use of this ratio is, to separate price and earnings in the enterprise value. By dividing the enterprise value of projected earnings (EPS), the result represents the price (P/E). And the difference represents the earnings (EPS).

ITG EV EPS

The EV/EPS valuation method indicates that the price (P/E) was 57 percent and the earnings (EPS) was 43 percent average. This indicates that the price was overvalued because the ratio was more than 50 percent.

Enterprise Value (EV)/ Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) or (EV/EBITDA)

This metric is used in estimating business valuation. It compares the value of the company inclusive of debt and other liabilities to the actual cash earnings exclusive of non-cash expenses. This metric is useful for analyzing and comparing profitability between companies and industries.

   ITG EV EBITDA

The average result for EV/EBITDA was 8 years or 8 times. Meaning, it will take 8 times the cash earnings of ITG to cover the costs of buying the entire business. and considered a long period of waiting. This valuation also indicates the profitability of the company. Since 8 years is a long period, digging into the financials of ITG, its net earnings were negative 20 percent. Investment Technology Group suffered losses from 2008 until ttm6 2012. So, ITG is unprofitable.

Conclusion

Overall, the stock price of ITG was overvalued or expensive. The growth was negative which shows that ITG is unprofitable. Therefore, I recommend a SELL in the stock of Investment Technology Group.

Researched and Written by Cris

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Investment Technology Group Inc (ITG) Company Research

August 24th, 2012 Posted by Company Research Report No Comment yet

This section of our article will give you the guide to value investing in how the financial status of Investment Technology Group Inc (ITG) goes along in the business.

Balance Sheet

For stock investors, the balance sheet is an important consideration for investing in a company because it is a reflection of what the company owns and owes. The strength of the company’s balance sheet can be evaluated by working its capital adequacy, asset performance, and capitalization structures.

Financial Liquidity

Financial liquidity of Investment Technology Group is good as far as its current resources are concerned. It has plenty of cash to settle its current as well as long term obligations. To compute for this, we used the current ratio, quick ratio, and working capital from 2007 to 2011 and the results were indicated below:

  • The current ratio in percent was 1.12, 1.24, 1.31, 1.11 and 1.22. Average of 1.18. The company’s proportion of current assets is 122 percent against its current liabilities.
  • The quick ratio in percent was 1.12, 1.24, 1.31, 1.11 and 1.22. An average of 1.18, which means that its monetary assets are 18 percent more than its current liabilities.
  • Working capital in dollars was  150.93, 189.48, 236.09, 170.77 and 169. Average of $183.25. ITG’s working capital showed a positive balance throughout its five year period with an average of $183.25. It means that the company is able to pay off its current and long term obligations.

Leverage

Based on the company’s performance through financial leverage ratio calculations, there was a need to continuously observe and monitor if the company could generate enough funds out of its resources to continuously run its business operation without additional borrowings made.

Another way to measure the financial stability of a company is through its financial leverage. Every investor should want to know if the business he wanted to invest in is not in depth debt. It is not bad to borrow money from banks or other creditors provided that such is closely monitored and no lapses in repayments. Let us find out the financial leverage ratio of ITG from 2007 to 2011 on the data below:

  • The debt ratio in percent was .66, .53, .49, .66 and .69. An average of .61 or 61 percent of the total assets of the company was owed from creditors.
  • Debt to equity ratio in percent was 1.98, 1.14, .96, 1.91 and 2.25. Average of 1.65. This means that ITG’s debt is equivalent to 165 percent average against its equity.
  • Solvency ratio was .08, .13, .05, .01 and 0. An average of .05. It means that the company is only 5 percent solvent. This is unhealthy.
  • Current liability to total asset was .60, .47, .45, .64 and .67. An average of .57. This shows us that the creditors have 57 percent claims on the company’s total assets.
  • Stockholders’ equity to total assets was .34, .47, .51, .34 and .31. An average of .39, which means that the owners or shareholders have only 39 percent claims on ITG’s total assets.

Asset Management

There are several general rules that should be kept in mind when calculating asset turnover. First, asset turnover is meant to measure a company’s efficiency in using its assets. The higher the number, the better;  but investors must be sure to compare a business in its industry since it is a misconception to compare completely unrelated businesses. In relation to the profit margin, the higher a company’s asset turnover, the lower its profit margin tends to be (and vice versa). For ITG, its fixed asset turnover ratio has an average of 15.64.

We would say that earnings of ITG  are classified into high quality when expressed as EBITDA since it is exclusive of the estimated amount. Earnings are important to shareholders because dividends are paid based on annual earnings. Sometimes earnings are expressed as EBIT (earnings before interest and taxes), or EBITDA (earnings before interest and taxes, depreciation and amortization. Earnings per share (net profit divided by the number of shares). For ITG, its earnings results from 2007 to 2011 are as follows:

  • EBIT in dollars was 174.18, 199.31, 202.78, 104.41 and 67.94. Average of 149.7. The company’s reported income before interest and tax deduction has an average of $149.7.
  • EBITDA in dollars was 196.68, 235.31, 256.98, 165.21 and 130.34. Average of 196.9. This is the average income of an ITG company before interest and tax, depreciation and amortization
  • Earnings per share was 2.21, 2.48, 2.61, .97 and .55. Average of 1.76.

ITG Income Statement

The reliability of the income statement as a report of the company’s performance differs widely among various types of companies. Net income of a retail store that sells only for cash has a high inventory turnover. Leases of its building and equipment are of high quality because the reported amount is relatively not influenced by estimates, while an income is of lower quality if it contains large items that require estimates of future events (such as depreciation expense).

Profitability

One area to consider in this area of financial statement is profitability. To calculate for this, we used the DuPont Method which consists of three components as shown below:

  • Net profit margin (NI/Sales) was 16.3, 15.2, 15.0, 6.8, 4.2 and -31.43. This simply was the after tax profit a company generated for each dollar of revenue.
  • Capital Turnover (Sales/Assets) was 48.0, 41.0, 40.3, 37.4, and 27.0 and 0.24. This measured the effectiveness of a company to convert its assets into sales.
  • Financial structure ratio (Assets/Shareholder’s Equity) was 241, 298, 214, 196, 291 and 325. This measured the financial leverage of the company
Calculation

Then multiply every three components to get;

  • Return on equity in percent was 18.3, 16.9, 15.4, 5.2, 2.8 and -23.33. The company could return such percent for every dollar of equity.

Computation of the return on assets:

  • Operating margin (EBIT/Sales) was 29.06, 27.3, 25.6, 12.1, 8.6 and -36.12. This measured the operations efficiency of the company.
  • Asset turnover was 48.0, 41.0, 40.0, 37.0, 27.0, and 24.0. This measured the total utilization efficiency of assets.

Lastly, multiply the two components and you get;

  • Return on assets was 7.90, 6.24, 6.06, 2.53, 1.13, and -7.64. This tells us how much profit the company generated for each dollar on total assets.

Explanation

ITG’s profitability analysis from 2006 to 2010 tells us that the company was able to generate a return on equity at an average of 11.72 or 12 percent for every $1 of investing capital, which was in a declining trend since 2008. It also declined to -23.33 percent during 2011. This means that ITG operations went down as portrayed by a decrease also in net income but in the 1st quarter of 2012, its prospective net income showed a good amount of 5.458 million dollars compared to 23.98 million dollars to -180 in 2010 and 2011, respectively.

Return on Assets

Return on assets (ROA) is an indicator of how profitable a company relative to its total assets. It showed a declined trend from 2006 to 2008 and a big leap in 2009 decreasing to a -7.64 percent in 2011. This means that the company is not progressing in using total assets enough to generate steady revenue, especially that in 2008 during the worldwide economic crisis, where it broke down a -62.64 percent decline in net income from 114.64 million dollars to 42.83 in 2008 and 2009, respectively.

Revenues

Let’s look into the total revenues, operating income, and net income of ITG. By comparing its income from 2006 to 2011, we could get the following results:

  • Total revenue in million dollars was 599.48, 731.00, 762.98, 633.07, 570.75 and 572. This was the company’s total earnings.
  • Operating income was 174, 199, 196, 76, 49, and -207. This was the company’s income after deducting all operations expenses.
  • Net income was 98, 111, 115, 43, 24, and -180. This was the company’s income after deducting income taxes.

Explanation

Total revenues depicted an increase in 2007 and 2008 of 21.94 percent and 4.38 but decreased by -17.03 and -9.84 in 2009 to 2010. In 2011 it increased slightly to 0.22.  then 2012 1st quarter decreases again to -9.13. This show a roller coaster trend meaning total revenues was not stable for ITG; it depends mostly from commissions and fees from investments plus recurring revenues from connectivity fees, software and analytical products, maintenance, customer technical support, investment research services, and others.

Operating income looks almost the same with total revenues showing growth in 2007 and 2008 of 8.43 percent and 3.53, the decline in 2009 to 2010 of -60.90 and -35.47 to -103.96 in 2012. This was caused by the increasing amount of operating expenses. While net income increase in 2007 and 2008 of 13.46 and 3.18, and then decreased in 2009 and 2010 of -62.64 and -44.02, to -39.13 in 2012.

Earnings per Share

In their earnings per share, it showed that from 2006 to 2008 they were earning as much as 2.21 dollars, 2.48, and 2.61 per share respectively. However, from 2009 to 2011 it declined down to 0.97, 0.55 and -4.42. This really would cause an alarming concern that management should look into their operations and find the means to solve their problem.

Expenses

What about their expenses for the year 2006 to 2010? Kindly take a look at the results provided below:

  • Cost of revenue was 80.70, 112.00, 95.08, 95.62 and 85.39Selling, general and administrative expenses was 344.60, 419.69, 465.13, 458.49 and 435.37
  • Income tax was 64.04, 77.76, 80.88, 33.62 and 25.35. In 2011 was 26.84; 2012 1st quarter was 3.036.
  • Operating expenses in 2011 was 778.67. In 2012 1st quarter was 127.88.

Explanation

The analysis of the expenses of the company from 2006 to 2010 tells us that, the cost of revenue represents 14.26 percent, while the operating expenses represent 64.9, and income taxes was 10  against average total revenue. In 2011 and 2012 1st quarter operating expenses account for -136 percent and 93.77 while income tax accounts for 4.69 and 2.22 against total revenue. Thus, the total deduction from average total revenue was 89.17 and the remaining 11.5 will be the net income average percentage; in 2011 and 2012 1st quarter was only -31.4 and 4.01. Therefore, this showed a very tight margin for net income against their total revenues, meaning that operations were heavily burdened by increasing expenses incurred.

Conclusion

“In conclusion, I can say that ITG was earning good in 2006 to 2008. But due to the worldwide financial crisis, their operations were badly hit and start to dwindle down. Total revenue declined; operating expenses and income taxes increased so, naturally net income also decreases to the extent that the company was losing in 2011. But in the 2012 1st quarter the company recovered a good sizable amount of net income of 5.5 million dollars. Total assets increase accounts for the increase in receivables thus, return on assets increase to 1.43 percent. While return on equity gave 8.2 results due to the increase in net income and a decrease in stockholders’ equity” Nelly said.

ITG Cash Flow Statement

The statement of cash flows is an integral part of a company’s financial statements. Does, it tells us the most important thing of all. And how much cash a company generates. It documents both cash coming in and cash going out of a business-income and expenditures. Moreover, it has three activities which are the operating, investing and financing.

Cash Flow from Operating

ITG had a negative result in 2007 and recovered in 2008 with an increase of 129 percent. In 2009 to 2011 it was shrinking. The main reason was that net income was also declining. The 2012Q1 had a negative result of 53 percent if we compared it from 2011Q1.

Cash from operating activities can be computed using the indirect method of accounting through the net income of the company and add or deduct the key accounts that give an impact for this activity like by deducting the accounts receivable and adding the accounts payable. Below are the results:

  • Net income in million dollars was 111, 115, 43, 24 and -180
  • Accounts receivable was -596, 474, 16, -793, 128 and -764
  • Accounts payable was 384,-317,-41, 862, -130, 700
  • Cash from operating activities was -109, 380, 97, 176, 67 and 1. In 2011Q1 was-58 compared to 2012Q1 was -123.

Explanation

Cash collections were the sum of total sales less the increase and add the decrease of accounts receivable. This is to determine if the management was effective in handling their collection. Below are the results:

  • Total sale was 731, 763, 633, 571 and 572
  • Accounts receivable was -596, 474, 16, -793 and 128
  • Cash collection was 1,327, 289, 617, 1,364 and 444.

The above results showed that the cash collection of the company was in sideways. It had a bulk collection in 2010, represented at 55 percent due to the decrease of accounts receivable.

Cash payment

The cash payments for purchases where the sum of the total cost of revenue. Deduct the increase or add the decrease of inventory and add the increase or deduct the decrease of accounts payable. These are the total cash paid by the company for their purchases per year. The following are the results for ITG:

  • Cost of revenue, the total was 112, 95.08, 95.62, 85.39 and 91.60
  • Total inventory for five years was zero
  • Accounts payable was 384, -317, -41, 862 and -130
  • Cash payment for purchases was 496.00, -221.92, 54.62, 947.39 and -130.

Explanation

Results shown was erratic in movement. In 2008, it had 324 percent down, due to the decrease of accounts payable and in 2010, up to 94 percent due to the increase of accounts payable. It indicates the cash payments paid for the operating expenses were also in sideways. It showed that only in 2011 they had an increase of 36 percent.

Cash payments for operating expense were the total cash paid for the operating expenses like selling or general and admin expenses also for unusual expenses. This can be computed by taking all the operating expenses and add the increase or deduct the decrease of prepaid expenses and then add the decrease or deduct the increase of accrued expenses. In ITG’s five years of operation, they had no record of prepaid and accrued expenses, then, the total operating expenses – 404.05, 452.27, 447.41, 427.47 and 671.75, results from 2007 to 2011 – were considered as the total cash payments for operating expenses.

Explanation

The cash payments for income tax were the sum of income tax total and by adding the decrease or deduct the increase of income taxes payable. Cash payments for income tax decreased from 2008 to 2011. It indicates that the year 2011 had decreased to negative 109 percent. This was due to the decline in the net income of the company. The results are:

  • Income tax – total was 77.76, 80.88, 33.62, 25.35 and -179.79
  • Income tax payable was 0, 3, -25, 10 and -6
  • Cash payment of income taxes was 77.76, 77.88, 58.62, 15.35 and -173.79.

By using the direct method of accounting, the cash from operating activity results are:

  • Cash collection was 1,327, 289, 617, 1,364 and 444
  • The cash payment for purchases was 496.00, -221.92, 54.62, 947.39 and -38.40
  • While, cash payment for operating expenses was 404.05, 452.27, 447.41, 427.47, and 671.75
  • In addition, the cash payment of income taxes was 77.76, 77.88, 58.62, 15.35 and -173.79
  • Net cash flow from operating activities was 349.19, -19.25, 56.42, -26.46 and -15.52.

Explanation

The total operating activities for five years were 344. The total cash collection for five years was represented at 1173 percent over the total cash operating activities, while the cash payment for purchases was 359 percent of the total cash payments. Operating expenses were 698 percent and the total cash payments for income taxes was 16 percent. It tells us the company had a greater percentage expense out in operating expense compared to the purchases.

The cash payments for operating activities using the direct method in accounting only had positive results in 2007 and 2009; the other years showed negative results. It was calculated using the cash collection less the cash payments for purchases, for operating expenses, and for income tax.

Cash Flow from Investing

To determine how much cash used for investing and where a company invested, we see that in the investing activities section in cash flow. The normal cash outflow compositions are the purchase of a fixed asset, intangibles, and acquisition of business and purchase of other investment. The inflow is the sale of maturity of investments. In ITG, the following are:

  • Sales/maturity of investments was 3, 3, 0, 0 and 2
  • Acquisition and disposition was -15, -6, -2, -49 and -36
  • Purchase of intangibles, net was -41, -43, -38 and -29
  • Other investing activities were -63,-26, -15, -15 and -23
  • Net cash used for investing activities was -74, -70, -60, -102 and -86.

Explanation

The net cash flow from investing of ITG was a straight negative result; the movement was also in sideways. It means, every year they kept on investing. It had a big impact on investment through the purchase of intangibles, represented at 39 percent total over the total of investing, and followed by other investment at 36 percent then the acquisition of a business represented at 27 percent.

Cash Flow from Financing

The cash flow from financing activities includes sales and re-purchases of corporate stocks, dividend payments, and long-term borrowings, from here we can determine the company’s funding commitments and why the business needs the money. For ITG, it resulted in the following:

  • Change in short-term borrowing was 101, -76, -25, 0 and 2.
  • Long-term debt issued was 0, 0, 0, 0, and 25.
  • Long-term debt repayment was -28, -38, -48, -47 and -4.
  • Common stock issued was 14, 7, 11, 11 and 10.
  • Repurchases of treasury stock were -50, 0, -23, -50 and -39
  • Other financing activities were 6, 0, -2, -4 and -6.
  • Net cash provided by (used for) financing activities was 43, -130, -64, -90 and -12.

The cash flow from financing resulted that it was in 2007 they had cash provided at 17 percent over the total cash in financing activities. From 2008 to 2011 had negative cash used in particular for long term debt repayment and repurchase of treasury stock.

Free Cash Flow

The free cash flow represents the company’s ability to generate cash but also signals that the company should be able to continue funding its operations. It can also determine the company’s ability to pay debt, dividends, buy back stock and facilitate the growth of the business. Below were the results of ITG free cash flow:

  • Net cash provided by operating activities was -109, 380, 97, 176 and 67
  • While, capital expenditure was 15, 47,45, 87 and 65
  • In addition, free cash flow was -124, 333, 52, 89 and 2.

The free cash flow has indicated that in 2007 they had negative results and recovered in 2008 to 2011 with positive free cash flow but it was shrinking due to the cash from operating which was also in sideways.

Cash Flow Solvency

  • Net cash provided by operating activities was -109,380,97,176,67.
  • On the other hand, total liabilities were1397,898,835, 1661 and 1507.
  • While cash flow solvency was -0.08, 0.42, 0.12, 0.11 and 0.04.

The cash flow solvency represented at every $1 of debt was -0.08,0.42,0.12,0.11 and0.04 from 2007 to 2011, respectively. It means, the company had no sufficient cash to pay its debt.

Written by: Rio, Nelly, and Dyne

Edited by Cris

Note:

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