Can LPK service its debt comfortably?

With a debt-to-equity ratio of 10.37%, LPK’s debt level may be seen as prudent. This range is considered safe as LPK is not taking on too much debt obligation, which can be restrictive and risky for equity-holders. Investors’ risk associated with debt is very low with LPK, and the company has plenty of headroom and ability to raise debt should it need to in the future.

Next Steps:

LPK’s low debt is also met with low coverage. This indicates room for improvement as its cash flow covers less than a quarter of its borrowings, which means its operating efficiency could be better. Furthermore, its lack of liquidity raises questions over current asset management practices for the small-cap. I admit this is a fairly basic analysis for LPK’s financial health. Other important fundamentals need to be considered alongside. I recommend you continue to research Lupaka Gold to get a better picture of the stock by looking at:

• 1. Valuation: What is LPK worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether LPK is currently mispriced by the market.
• 2. Historical Performance: What has LPK’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
• 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.