What is Books-A-Million Degree of Financial Leverage?
Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in Earnings Before Interest and Taxes (EBIT).
Books-A-Million's Degree of Financial Leverage for the quarter that ended in Oct. 2015 was 0.00. The higher Degree of Financial Leverage, the more volatile earnings will be.
The industry rank for Books-A-Million's Degree of Financial Leverage or its related term are showing as below:
BAMM's Degree of Financial Leverage is not ranked *
in the Retail - Cyclical industry.
Industry Median: 1.05 * Ranked among companies with meaningful Degree of Financial Leverage only.
Books-A-Million Degree of Financial Leverage Historical Data
The historical data trend for Books-A-Million's Degree of Financial Leverage can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Premium members only.
Books-A-Million Degree of Financial Leverage Chart
Competitive Comparison of Books-A-Million's Degree of Financial Leverage
For the Specialty Retail subindustry, Books-A-Million's Degree of Financial Leverage, along with its competitors' market caps and Degree of Financial Leverage data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Books-A-Million's Degree of Financial Leverage Distribution in the Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Books-A-Million's Degree of Financial Leverage distribution charts can be found below:
* The bar in red indicates where Books-A-Million's Degree of Financial Leverage falls into.
Books-A-Million Degree of Financial Leverage Calculation
Books-A-Million's Degree of Financial Leverage for the quarter that ended in Oct. 2015 is calculated as:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
** TTM data of EPS and EBIT was used to calculate Degree of Financial Leverage.
*** Please be aware that the Degree of Financial Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.
Books-A-Million (NAS:BAMM) Degree of Financial Leverage Explanation
Degree of Financial Leverage (DFL) is a leverage ratio that measures the sensitivity of a company’s Earnings per Share (EPS) to fluctuations in its operating income, also referred to as Earnings Before Interest and Taxes (EBIT), resulting from adjustments in its capital structure. DFL is an essential tool for companies to assess the appropriate level of debt or financial leverage in their capital structure. When EBIT remains relatively stable, it results in stable earnings and earnings per share. In such cases, the company may consider taking on substantial debt. However, for companies operating in industries with significant fluctuations in EBIT, it is advisable to keep debt at a manageable level.
The higher Degree of Financial Leverage, the more volatile earnings will be. Because interest is a fixed expense, leverage can amplify earnings and EPS. This is beneficial when EBIT is growing, but it can become problematic in tough economic conditions when EBIT is under pressure.
Be Aware
The use of financial leverage varies across different industries and business sectors, and the application of Degree of Financial Leverage (DFL) should be adjusted accordingly.
Books-A-Million Degree of Financial Leverage Related Terms
Thank you for viewing the detailed overview of Books-A-Million's Degree of Financial Leverage provided by GuruFocus.com. Please click on the following links to see related term pages.
Books-A-Million (Books-A-Million) Business Description
Books-A-Million Inc was founded in 1917, originally incorporated under the laws of the State of Alabama in 1964 and reincorporated in Delaware in September 1992. The Company is a book retailer located in the eastern United States and operates both superstores and traditional bookstores. The Company operates both superstores and traditional bookstores. The first Superstore was opened in 1987 and operates under the names Books-A-Million and Books and Co. and 2nd & Charles. Traditional bookstores are smaller stores operated under the names Bookland, Books-A-Million and BAM. All store formats generally offer a selection of sellers and other hardcover and paperback books, magazines, toys, games, electronics and gifts. In addition to these retail store formats, it offers its products over the internet at Booksamillion.com. Its retail operations also include the operation of Yogurt Mountain Holding, LLC, a retailer and franchisor of self-serve frozen yogurt stores. It also develops and manages commercial real estate investments through its subsidiary, Preferred Growth Properties, LLC. The Company operates in three reportable operating segments: Retail trade; Electronic commerce trade; and Real estate development and management. In the retail trade segment, it is engaged in the retail sale of books, magazines and general merchandise, including gifts, cards, games, toys, collectibles, music, DVDs, electronic devices and accessories in its retail stores. In the electronic commerce trade segment, it is engaged in the retail sale of books and general merchandise over the internet. The real estate development and management segment is managed separately from the retail trade and electronic commerce trade segments, with a focus on deriving revenues through developing and leasing commercial retail real estate for purposes of earning rental income. The Company promotes its bookstores through the use of traditional direct mail, e-mail and online advertising, as well as point-of-sale materials posted and distributed in its stores. The retail book business is competitive. The Company faces direct competition from other superstores, such as Barnes & Noble, and it also faces competition from mass merchandisers, such as Wal-Mart and Costco, and online retailers, such as Amazon.com, Barnes & Noble and Wal-Mart. Its bookstores also compete with specialty retail stores that offer books in particular subject areas, independent single store operators, variety discounters, drugstores, warehouse clubs, mail order clubs and other retailers offering books. In addition, its bookstores face additional competition from the market for electronic books and may face competition from other categories of retailers entering the retail book market. The Company is subject to general business regulations and laws, as well as regulations and laws specifically governing the Internet and e-commerce.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
BAMM has been successfully added to your 