Cash-per-Share

Cash per share is taking the total cash and dividing it by the average share total. This type of tool is one that many fundamental or value investors will use to get them going on a potential investment.

Updated over a year ago
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How this number is used is if the cash per share is lower than the current stock price, then it may be an indication that current stock price may drop, but if the cash per share is higher, this could be a potential investing opportunity that signals value. Value investing is looking to get a stock many people are passing up because of various reasons, but if you dig under the hood, the engine is running just fine and the company is going through a rough patch.

How important is MEDALLION FINANCIAL's Liquidity

MEDALLION FINANCIAL financial leverage refers to using borrowed capital as a funding source to finance MEDALLION FINANCIAL CORP ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. MEDALLION FINANCIAL 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. Please check the breakdown between MEDALLION FINANCIAL's total debt and its cash.

How does MEDALLION utilize its cash?

To perform a cash flow analysis of MEDALLION FINANCIAL, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash MEDALLION FINANCIAL is receiving and how much cash it distributes out in a given period. The MEDALLION FINANCIAL cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Of course you have to look at other data points in fundamental investing as this may just be a good starting point. Cash per share can also be used a comparison tool across many different companies within the same industry.

The more cash a company has on hand the better because first, they are able to pay their debts back quickly if they have any. Secondly, this means they can implement a stock buy back program because if you are a current or potential investor, this means the value of stock should rise due to supply and demand.

Now you have to test this and insure it fits your current investing and evaluation style, especially if you are a technical trader as this is fundamental data. Cash is the lifeblood of a company and needs to be monitored closely, otherwise the company and you the investor could be in pinch.

With all of that being said, research the data point and find out how you can fine-tune it for your own use. Read articles and join an investing and trading group because they can help you if you have any questions. If you end up not using it, you will still have the knowledge to take with further in your financial career. Be sure not to rely to heavily on any one area because you want to paint yourself a well round picture and not be limited to one aspect. Again, you want a higher cash per share as this indicates that the stock may have more room to run to the upside.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Nathan Young do not own shares of MEDALLION FINANCIAL CORP. Please refer to our Terms of Use for any information regarding our disclosure principles.

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