A business plan that depends on leverage
Mortgages on income properties will permanently reset to a higher level
debt equity ratio
Financial strength – the debt equity ratio has serious shortcomings
No company under consideration will even be close to scrambling to pay its creditors.
The fading usefulness of book value
Book Value – Ain’t what it used to be – With the rise of company investment in intangibles, book value is losing its relevance.
Something over 80% of the market capitalization of the S&P 500 is made up of intangibles. Only a fraction of that appears on balance sheets.
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