High LeverageA high debt-to-equity ratio raises interest and refinancing risk, constraining strategic flexibility. In adverse rate or revenue scenarios, heavy leverage can pressure cash flows, force deleveraging actions, or limit capacity for opportunistic investments over the medium term.
Low Equity RatioA low equity ratio means the balance sheet is largely financed by liabilities, reducing the loss-absorption buffer. This increases vulnerability to asset or market shocks and can raise borrowing costs or restrict additional funding during downturns, hampering strategic options.
Cash Flow Volatility HistoryDespite recent FCF growth, historical cash flow volatility implies earnings and cash are sensitive to AUM flows or investment timing. This reduces predictability for debt servicing, dividends and capex planning, increasing execution risk over the next several quarters.