--- title: "Does Ashtead Group (LON:AHT) Have A Healthy Balance Sheet?" description: "Ashtead Group (LON:AHT) has a significant amount of debt, totaling US$7.68 billion, with liabilities exceeding cash and receivables by US$12.4 billion. Despite a market capitalization of US$29.5 billi" type: "news" locale: "en" url: "https://longbridge.com/en/news/272982181.md" published_at: "2026-01-19T14:15:40.000Z" --- # Does Ashtead Group (LON:AHT) Have A Healthy Balance Sheet? > Ashtead Group (LON:AHT) has a significant amount of debt, totaling US$7.68 billion, with liabilities exceeding cash and receivables by US$12.4 billion. Despite a market capitalization of US$29.5 billion, the company's EBIT dropped 5.3% last year, raising concerns about its ability to manage debt. Its net debt is 1.6 times EBITDA, and interest coverage is 4.6 times EBIT. While the debt is manageable, the declining earnings trend poses risks for investors. Overall, Ashtead Group is considered a somewhat risky investment due to its debt levels. Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously said that 'Volatility is far from synonymous with risk.' When we think about how risky a company is, we always like to look at its use of debt, since debt overload can lead to ruin. We note that **Ashtead Group plc** (LON:AHT) does have debt on its balance sheet. But is this debt a concern to shareholders? This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. ## What Risk Does Debt Bring? Debt and other liabilities become risky for a business when it cannot easily fulfill those obligations, either with free cash flow or by raising capital at an attractive price. If things get really bad, the lenders can take control of the business. However, a more frequent (but still costly) occurrence is where a company must issue shares at bargain-basement prices, permanently diluting shareholders, just to shore up its balance sheet. Of course, plenty of companies use debt to fund growth, without any negative consequences. The first step when considering a company's debt levels is to consider its cash and debt together. ## What Is Ashtead Group's Net Debt? As you can see below, Ashtead Group had US$7.68b of debt at October 2025, down from US$8.19b a year prior. Net debt is about the same, since the it doesn't have much cash. ## How Healthy Is Ashtead Group's Balance Sheet? We can see from the most recent balance sheet that Ashtead Group had liabilities of US$1.86b falling due within a year, and liabilities of US$12.8b due beyond that. Offsetting these obligations, it had cash of US$39.6m as well as receivables valued at US$2.18b due within 12 months. So its liabilities total US$12.4b more than the combination of its cash and short-term receivables. While this might seem like a lot, it is not so bad since Ashtead Group has a huge market capitalization of US$29.5b, and so it could probably strengthen its balance sheet by raising capital if it needed to. However, it is still worthwhile taking a close look at its ability to pay off debt. See our latest analysis for Ashtead Group We use two main ratios to inform us about debt levels relative to earnings. The first is net debt divided by earnings before interest, tax, depreciation, and amortization (EBITDA), while the second is how many times its earnings before interest and tax (EBIT) covers its interest expense (or its interest cover, for short). This way, we consider both the absolute quantum of the debt, as well as the interest rates paid on it. Ashtead Group's net debt is sitting at a very reasonable 1.6 times its EBITDA, while its EBIT covered its interest expense just 4.6 times last year. While these numbers do not alarm us, it's worth noting that the cost of the company's debt is having a real impact. Sadly, Ashtead Group's EBIT actually dropped 5.3% in the last year. If that earnings trend continues then its debt load will grow heavy like the heart of a polar bear watching its sole cub. 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 Ashtead Group's ability to maintain a healthy balance sheet going forward. So if you're focused on the future you can check out this **free** report showing analyst profit forecasts. Finally, while the tax-man may adore accounting profits, lenders only accept cold hard cash. So it's worth checking how much of that EBIT is backed by free cash flow. In the last three years, Ashtead Group's free cash flow amounted to 42% of its EBIT, less than we'd expect. That's not great, when it comes to paying down debt. ## Our View Both Ashtead Group's EBIT growth rate and its interest cover were discouraging. But its not so bad at managing its debt, based on its EBITDA,. Looking at all the angles mentioned above, it does seem to us that Ashtead Group is a somewhat risky investment as a result of its debt. Not all risk is bad, as it can boost share price returns if it pays off, but this debt risk is worth keeping in mind. The balance sheet is clearly the area to focus on when you are analysing debt. But ultimately, every company can contain risks that exist outside of the balance sheet. **We've identified 1 warning sign** with Ashtead Group , and understanding them should be part of your investment process. Of course, if you're the type of investor who prefers buying stocks without the burden of debt, then don't hesitate to discover our exclusive list of net cash growth stocks, today. ### Related Stocks - [ASHGY.US - ASHTEAD GROUP SPON ADS EACH REP 1 ORD SHS](https://longbridge.com/en/quote/ASHGY.US.md) - [ASHTY.US - Ashtead Group plc](https://longbridge.com/en/quote/ASHTY.US.md) - [AHT.UK - Ashtead Group plc](https://longbridge.com/en/quote/AHT.UK.md) ## Related News & Research | Title | Description | URL | |-------|-------------|-----| | Ashtead Continues $1.5bn Buyback With Fresh Treasury Share Purchase | Ashtead Group plc has continued its $1.5bn share repurchase program, buying back 84,833 shares on February 16, 2026, at | [Link](https://longbridge.com/en/news/276100949.md) | | Ashtead Group reaffirming full-year group rental revenue, capex, and free cash flow guidance | Ashtead Group reaffirming full-year group rental revenue, capex, and free cash flow guidance | [Link](https://longbridge.com/en/news/269048673.md) | | Altus Group reports Q4 results | Altus Group reports Q4 results | [Link](https://longbridge.com/en/news/276388796.md) | | Macquarie Technology Group Upsizes Debt Capacity To A$500 Million | Macquarie Technology Group Ltd :UPSIZES DEBT CAPACITY TO A$500 MILLION | [Link](https://longbridge.com/en/news/276214726.md) | | Risk Capital Ltd Inspecs Group Says Switch To Takover Offer | Inspecs Group PLC :RISK CAPITAL LTD INSPECS GROUP PLC - SWITCH TO A TAKOVER OFFER | [Link](https://longbridge.com/en/news/276475286.md) | --- > **Disclaimer**: This article is for reference only and does not constitute any investment advice.