GREY:CHALF - Post by User
Post by
RebeccaGon Feb 02, 2022 12:25pm
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Post# 34389476
Why makes investing in CHALF is very risky?
Why makes investing in CHALF is very risky? Simple, Chalice has a High Debt-to-Equity Ratio (Total Debt To Equity Ratio 68, check out the financials:
The debt-to-equity (D/E) ratio is a metric that provides insight into a company's use of debt. Any company (like CHALF) with a high D/E ratio is considered a higher RISK to lenders and INVESTORS because it suggests that the company is financing a significant amount of its potential growth through borrowing
CHALF is overleveraged or simply, it has too much debt. Debt impedes Chalice’s ability to make principal and interest payments and to cover operating expenses. Being overleveraged leads to a downward financial spiral resulting in the need to borrow more until insolvency.