Manhattan Bridge Capital, Inc. (LOAN) Bundle
Understanding Manhattan Bridge Capital, Inc. (LOAN) Revenue Streams
Understanding Manhattan Bridge Capital, Inc.’s Revenue Streams
Revenue Overview
Total revenues for the nine months ended September 30, 2024, were approximately $7,330,000, compared to approximately $7,231,000 for the same period in 2023, reflecting an increase of $99,000 or 1.4%.
Breakdown of Primary Revenue Sources
The primary sources of revenue for the company are:
- Interest income from secured commercial loans: approximately $6,128,000 for the nine months ended September 30, 2024, compared to $5,889,000 for the same period in 2023.
- Origination fees from loans: approximately $1,201,000 for the nine months ended September 30, 2024, down from $1,342,000 in 2023.
Year-over-Year Revenue Growth Rate
The year-over-year revenue growth rate showed a slight increase in total revenues:
- 2024: $7,330,000
- 2023: $7,231,000
- Percentage change: 1.4%
Contribution of Different Business Segments to Overall Revenue
| Revenue Source | 2024 Revenue | 2023 Revenue | Change | Percentage of Total Revenue (2024) |
|---|---|---|---|---|
| Interest Income | $6,128,000 | $5,889,000 | $239,000 | 83.5% |
| Origination Fees | $1,201,000 | $1,342,000 | -$141,000 | 16.5% |
Analysis of Significant Changes in Revenue Streams
Despite the overall increase in revenue, there was a notable decline in origination fees due to a slowdown in new loan originations:
- Origination fees decreased by 10.5% year-over-year.
- Interest income increased as a result of higher interest rates charged on commercial loans.
In summary, the company continues to rely heavily on interest income from secured loans, while experiencing challenges in origination fees amidst market conditions affecting new loan origination activities.
A Deep Dive into Manhattan Bridge Capital, Inc. (LOAN) Profitability
A Deep Dive into Manhattan Bridge Capital, Inc.'s Profitability
Gross Profit Margin: For the nine months ended September 30, 2024, the gross profit was approximately $4,271,700, compared to approximately $4,098,922 for the same period in 2023, reflecting a gross profit margin of approximately 58.3% for 2024.
Operating Profit Margin: The operating profit for the nine months ended September 30, 2024, stood at $4,271,700, yielding an operating margin of approximately 58.3%. This was a slight increase from $4,098,922 and an operating margin of approximately 56.7% for the same period in 2023.
Net Profit Margin: Net income for the nine months ended September 30, 2024, was approximately $4,284,550, leading to a net profit margin of approximately 58.5%. In comparison, the net income for the nine months ended September 30, 2023, was approximately $4,127,652, resulting in a net profit margin of approximately 57.1%.
| Metrics | 2024 | 2023 |
|---|---|---|
| Gross Profit | $4,271,700 | $4,098,922 |
| Operating Profit | $4,271,700 | $4,098,922 |
| Net Income | $4,284,550 | $4,127,652 |
| Gross Profit Margin | 58.3% | 56.7% |
| Operating Profit Margin | 58.3% | 56.7% |
| Net Profit Margin | 58.5% | 57.1% |
Trends in Profitability Over Time: The profitability metrics indicate a positive trend, with gross profit increasing by approximately 4.2% year-over-year, and net income showing a growth of approximately 3.8% for the same period.
Comparison of Profitability Ratios with Industry Averages: The company's gross profit margin of approximately 58.3% is significantly higher than the industry average of around 40% for financial services, indicating strong operational efficiency. Similarly, the net profit margin of approximately 58.5% also exceeds the industry average of around 30%.
Operational Efficiency Analysis: General and administrative expenses for the nine months ended September 30, 2024, were approximately $1,225,041, which is a decrease of 3.8% from $1,274,267 in the previous year. This reduction is attributed to lower marketing expenses and a one-time bonus in 2023.
Cost Management: The company has effectively managed its interest and amortization costs, which were approximately $1,831,037 for the nine months ended September 30, 2024, compared to $1,856,079 for the same period in 2023, representing a decrease of 1.3%.
| Expense Type | 2024 | 2023 | Change (%) |
|---|---|---|---|
| General and Administrative Expenses | $1,225,041 | $1,274,267 | -3.8% |
| Interest and Amortization Costs | $1,831,037 | $1,856,079 | -1.3% |
Gross Margin Trends: The gross margin has remained stable, supported by consistent revenue generation from interest income, which was approximately $6,128,131 for the nine months ended September 30, 2024, up from $5,888,843 in 2023. This demonstrates the company's ability to maintain profitability despite fluctuations in origination fees and loan volumes.
Debt vs. Equity: How Manhattan Bridge Capital, Inc. (LOAN) Finances Its Growth
Debt vs. Equity: How Manhattan Bridge Capital, Inc. Finances Its Growth
As of September 30, 2024, the company reported total liabilities of $27,431,084 compared to $33,502,180 at the end of 2023. This reduction in liabilities indicates a strategic move towards managing debt levels effectively.
At the same date, the total stockholders' equity stood at $43,270,919. This provides a debt-to-equity ratio of approximately 0.63 (calculated as total liabilities divided by total equity), which is below the industry average, suggesting a more conservative approach to leveraging compared to peers in the sector.
The company has utilized both long-term and short-term financing options. The long-term debt includes senior secured notes of $6,000,000 issued by MBC Funding II, maturing on April 22, 2026, with a fixed interest rate of 6%. The short-term financing primarily comes from a credit line with Webster Business Credit Corporation, which provides a credit line of $32.5 million.
As of September 30, 2024, the outstanding amount under the Amended and Restated Credit Agreement was $19,170,268, with an interest rate of approximately 8.4%. This credit line has been a significant source of liquidity for the company, allowing it to fund its lending activities while keeping a balanced capital structure.
In terms of recent debt issuances, the company has engaged in a series of loan collections and issuances, with $29,362,922 lent during the nine months ended September 30, 2024, and collections amounting to $33,749,887. This reflects an active management of loan portfolios, ensuring cash flow stability while servicing debt.
The following table summarizes the company’s debt and equity structure:
| Category | Amount |
|---|---|
| Total Liabilities | $27,431,084 |
| Total Stockholders' Equity | $43,270,919 |
| Debt-to-Equity Ratio | 0.63 |
| Long-term Debt (Senior Secured Notes) | $6,000,000 |
| Outstanding Credit Line Amount | $19,170,268 |
| Interest Rate on Credit Line | 8.4% |
| Loans Issued (2024) | $29,362,922 |
| Collections Received (2024) | $33,749,887 |
This strategic balance between debt and equity financing allows the company to pursue growth opportunities while managing financial risk effectively.
Assessing Manhattan Bridge Capital, Inc. (LOAN) Liquidity
Assessing Manhattan Bridge Capital, Inc.'s Liquidity
Current Ratio: As of September 30, 2024, the current ratio is approximately 0.06, calculated from current assets of $168,000 and current liabilities of $2,692,000.
Quick Ratio: The quick ratio is also approximately 0.06, as the company does not maintain significant inventories and primarily relies on cash and receivables.
Analysis of Working Capital Trends
Working capital as of September 30, 2024, is approximately ($2,524,000), indicating a negative working capital position. This reflects a decrease from approximately ($2,300,000) at the end of 2023, pointing to increasing liquidity challenges.
Cash Flow Statements Overview
Operating Cash Flow: For the nine months ended September 30, 2024, net cash provided by operating activities was $4,005,000, a slight decrease from $4,137,000 for the same period in 2023.
Investing Cash Flow: Net cash provided by investing activities was $4,383,000 for the nine months ended September 30, 2024, compared to $3,697,000 in 2023. This increase is primarily due to collections from commercial loans.
Financing Cash Flow: Net cash used in financing activities amounted to $9,912,000 for the nine months ended September 30, 2024, up from $7,805,000 in 2023, mainly due to dividend payments and line of credit repayments.
Potential Liquidity Concerns or Strengths
The company’s liquidity position is concerning due to its low current and quick ratios. The negative working capital trend, coupled with high cash outflows in financing activities, suggests potential difficulties in meeting short-term obligations. However, the increase in cash flow from investing activities provides some liquidity strength in terms of cash collections from loans.
| Financial Metric | 2024 (9 months) | 2023 (9 months) |
|---|---|---|
| Cash | $168,000 | $104,000 |
| Current Ratio | 0.06 | 0.04 |
| Quick Ratio | 0.06 | 0.04 |
| Net Cash from Operating Activities | $4,005,000 | $4,137,000 |
| Net Cash from Investing Activities | $4,383,000 | $3,697,000 |
| Net Cash Used in Financing Activities | $9,912,000 | $7,805,000 |
| Working Capital | ($2,524,000) | ($2,300,000) |
Overall, while the company has managed to generate positive cash flows from its operations and investments, the liquidity ratios and working capital situation indicate potential vulnerabilities that investors should monitor closely.
Is Manhattan Bridge Capital, Inc. (LOAN) Overvalued or Undervalued?
Valuation Analysis
Evaluating the financial health of a company often involves assessing its valuation metrics, which help determine whether the stock is overvalued or undervalued. For this analysis, we will explore the price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield, and analyst consensus.
Price-to-Earnings (P/E) Ratio
As of the latest financial data, the P/E ratio is calculated as follows:
- Net Income (2024): $4,284,550
- Weighted Average Shares Outstanding: 11,438,651
- Earnings Per Share (EPS): $0.37
- Current Stock Price: $6.25
- P/E Ratio: $6.25 / $0.37 = 16.89
Price-to-Book (P/B) Ratio
The P/B ratio is calculated using the following data:
- Total Stockholders' Equity: $43,270,919
- Total Shares Outstanding: 11,438,651
- Book Value Per Share: $43,270,919 / 11,438,651 = $3.79
- P/B Ratio: $6.25 / $3.79 = 1.65
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
The EV/EBITDA ratio is computed as follows:
- Market Capitalization: $6.25 11,438,651 = $71,646,787
- Total Debt: $19,170,268
- Cash and Cash Equivalents: $167,863
- Enterprise Value (EV): $71,646,787 + $19,170,268 - $167,863 = $90,649,192
- EBITDA for 2024: Net Income + Interest + Taxes + Depreciation + Amortization = $4,284,550 + $1,831,037 + $0 + $3,480 + $66,427 = $6,185,994
- EV/EBITDA Ratio: $90,649,192 / $6,185,994 = 14.63
Stock Price Trends
Over the last 12 months, the stock price has exhibited the following trends:
- 12-Month High: $8.50
- 12-Month Low: $5.50
- Current Price: $6.25
Dividend Yield and Payout Ratios
For the latest dividend data:
- Annual Dividend Paid: $0.36
- Dividend Yield: ($0.36 / $6.25) 100 = 5.76%
- Payout Ratio: ($0.36 / $0.37) 100 = 97.3%
Analyst Consensus on Stock Valuation
According to the latest analyst reports:
- Buy Ratings: 2
- Hold Ratings: 3
- Sell Ratings: 1
| Metric | Value |
|---|---|
| P/E Ratio | 16.89 |
| P/B Ratio | 1.65 |
| EV/EBITDA Ratio | 14.63 |
| 12-Month High | $8.50 |
| 12-Month Low | $5.50 |
| Current Stock Price | $6.25 |
| Annual Dividend | $0.36 |
| Dividend Yield | 5.76% |
| Payout Ratio | 97.3% |
| Buy Ratings | 2 |
| Hold Ratings | 3 |
| Sell Ratings | 1 |
Key Risks Facing Manhattan Bridge Capital, Inc. (LOAN)
Key Risks Facing Manhattan Bridge Capital, Inc. (LOAN)
Overview of Internal and External Risks:
- Industry Competition: The competitive landscape in the real estate financing market is intensifying, with numerous players vying for market share, which can impact pricing and profitability.
- Regulatory Changes: Changes in regulations affecting lending practices, interest rates, and tax structures for real estate investment trusts (REITs) pose a risk to operational viability and financial performance.
- Market Conditions: Economic downturns or fluctuations in the real estate market can lead to a decrease in demand for loans, affect loan origination fees, and increase default rates.
Discussion of Operational, Financial, or Strategic Risks:
- Operational Risk: As of September 30, 2024, the company had $22,526 in loans receivable originally due in 2016, $1,760,250 due in 2020, $120,000 due in 2021, $4,995,000 due in 2022, $14,738,817 due in 2023, and $16,575,000 originally due in the first nine months of 2024. The potential for defaults on these loans represents a significant operational risk.
- Financial Risk: The outstanding amount under the Amended and Restated Credit Agreement was $19,170,268 as of September 30, 2024, with an interest rate of approximately 8.4%. This financial burden could strain cash flows, especially if loan repayments are delayed or defaults increase.
- Strategic Risk: The company relies heavily on repeat business and referrals, which may be affected by shifts in customer satisfaction or market reputation.
Mitigation Strategies:
- The company maintains compliance with all covenants of the Webster Credit Line, which helps manage financial risk.
- As of September 30, 2024, the company was committed to $8,147,338 in construction loans that can be drawn by borrowers when certain conditions are met, ensuring a pipeline of active loans.
| Category | Amount |
|---|---|
| Loans Receivable (2016) | $22,526 |
| Loans Receivable (2020) | $1,760,250 |
| Loans Receivable (2021) | $120,000 |
| Loans Receivable (2022) | $4,995,000 |
| Loans Receivable (2023) | $14,738,817 |
| Loans Receivable (2024) | $16,575,000 |
| Outstanding Credit Amount | $19,170,268 |
| Interest Rate on Credit | 8.4% |
| Construction Loans Committed | $8,147,338 |
Future Growth Prospects for Manhattan Bridge Capital, Inc. (LOAN)
Future Growth Prospects for Manhattan Bridge Capital, Inc. (LOAN)
Analysis of Key Growth Drivers
The company is focused on expanding its loan portfolio through increased interest income from secured commercial loans. For the nine months ended September 30, 2024, revenues from interest income were approximately $6,128,000, compared to $5,889,000 for the same period in 2023, marking an increase of 4.1%. Additionally, the market for short-term secured loans remains robust, particularly in real estate investment, which is a primary focus area for the company.
Future Revenue Growth Projections and Earnings Estimates
The total revenues for the nine months ended September 30, 2024, were approximately $7,330,000, compared to $7,231,000 for the same period in 2023, reflecting a growth of 1.4%. Analysts anticipate continued growth, with expectations of revenue reaching approximately $10 million by the end of 2025 based on current loan origination trends and interest rate environments.
Strategic Initiatives or Partnerships That May Drive Future Growth
The company has established a credit line of $32.5 million with Webster Business Credit Corporation, which is intended to enhance liquidity and support further lending activities. This credit line is crucial for maintaining financial flexibility and enabling the company to respond quickly to market opportunities.
Competitive Advantages That Position the Company for Growth
Manhattan Bridge Capital benefits from a robust business model that includes secured loans primarily backed by real estate. As of September 30, 2024, the company’s loans receivable totaled approximately $68,711,438, showcasing a diverse portfolio across residential, commercial, and mixed-use developments. The company also maintains a high level of compliance with all covenants of its credit agreements, ensuring operational stability and investor confidence.
| Growth Metric | 2023 Amount | 2024 Amount | Growth Percentage |
|---|---|---|---|
| Total Revenues | $7,231,000 | $7,330,000 | 1.4% |
| Interest Income | $5,889,000 | $6,128,000 | 4.1% |
| Loans Receivable | $73,048,403 | $68,711,438 | -5.0% |
| Credit Line | N/A | $32,500,000 | N/A |
Market Expansion Opportunities
The company is actively exploring new markets, particularly in Florida and other emerging real estate sectors. The total amount of loans issued during the nine months ended September 30, 2024, was approximately $29,362,922, down from $40,810,565 in 2023. However, the company continues to receive repeat business and referrals, which are critical for sustainable growth.
Conclusion
Overall, Manhattan Bridge Capital, Inc. is well-positioned to capitalize on growth opportunities through strategic partnerships, a solid loan portfolio, and ongoing market expansion efforts.
Manhattan Bridge Capital, Inc. (LOAN) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Article updated on 8 Nov 2024
Resources:
- Manhattan Bridge Capital, Inc. (LOAN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Manhattan Bridge Capital, Inc. (LOAN)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Manhattan Bridge Capital, Inc. (LOAN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.