Here's Why Broadpeak Société anonyme (EPA:ALBPK) Can Afford Some Debt

Warren Buffett famously said, 'Volatility is far from synonymous with risk.' So it might be obvious that you need to consider debt, when you think about how risky any given stock is, because too much debt can sink a company. Importantly, Broadpeak Société anonyme (EPA:ALBPK) does carry debt. But is this debt a concern to shareholders?

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What Risk Does Debt Bring?

Debt is a tool to help businesses grow, but if a business is incapable of paying off its lenders, then it exists at their mercy. If things get really bad, the lenders can take control of the business. While that is not too common, we often do see indebted companies permanently diluting shareholders because lenders force them to raise capital at a distressed price. By replacing dilution, though, debt can be an extremely good tool for businesses that need capital to invest in growth at high rates of return. When we examine debt levels, we first consider both cash and debt levels, together.

How Much Debt Does Broadpeak Société anonyme Carry?

You can click the graphic below for the historical numbers, but it shows that Broadpeak Société anonyme had €10.2m of debt in June 2025, down from €12.0m, one year before. However, because it has a cash reserve of €1.11m, its net debt is less, at about €9.07m.

How Strong Is Broadpeak Société anonyme's Balance Sheet?

We can see from the most recent balance sheet that Broadpeak Société anonyme had liabilities of €27.7m falling due within a year, and liabilities of €2.87m due beyond that. On the other hand, it had cash of €1.11m and €23.5m worth of receivables due within a year. So it has liabilities totalling €5.96m more than its cash and near-term receivables, combined.

Broadpeak Société anonyme has a market capitalization of €27.8m, so it could very likely raise cash to ameliorate its balance sheet, if the need arose. But we definitely want to keep our eyes open to indications that its debt is bringing too much risk. There's no doubt that we learn most about debt from the balance sheet. But it is future earnings, more than anything, that will determine Broadpeak Société anonyme's ability to maintain a healthy balance sheet going forward. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting.

View our latest analysis for Broadpeak Société anonyme

Over 12 months, Broadpeak Société anonyme reported revenue of €51m, which is a gain of 11%, although it did not report any earnings before interest and tax. That rate of growth is a bit slow for our taste, but it takes all types to make a world.

Caveat Emptor

Over the last twelve months Broadpeak Société anonyme produced an earnings before interest and tax (EBIT) loss. Its EBIT loss was a whopping €4.2m. When we look at that and recall the liabilities on its balance sheet, relative to cash, it seems unwise to us for the company to have any debt. So we think its balance sheet is a little strained, though not beyond repair. Another cause for caution is that is bled €957k in negative free cash flow over the last twelve months. So suffice it to say we do consider the stock to be risky. When analysing debt levels, the balance sheet is the obvious place to start. But ultimately, every company can contain risks that exist outside of the balance sheet. To that end, you should learn about the 2 warning signs we've spotted with Broadpeak Société anonyme (including 1 which is significant) .

If, after all that, you're more interested in a fast growing company with a rock-solid balance sheet, then check out our list of net cash growth stocks without delay.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.