eFuture Holding (eFuture Holding) Degree of Financial Leverage : 0.00 (As of Sep. 2016)

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What is eFuture Holding 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). eFuture Holding's Degree of Financial Leverage for the quarter that ended in Sep. 2016 was 0.00. The higher Degree of Financial Leverage, the more volatile earnings will be.

The industry rank for eFuture Holding's Degree of Financial Leverage or its related term are showing as below:

EFUT's Degree of Financial Leverage is not ranked ^*
in the Software industry.
Industry Median: 0.99
* Ranked among companies with meaningful Degree of Financial Leverage only.

eFuture Holding Degree of Financial Leverage Historical Data

The historical data trend for eFuture Holding'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.

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eFuture Holding Degree of Financial Leverage Chart

eFuture Holding Annual Data

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Degree of Financial Leverage

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eFuture Holding Quarterly Data
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Competitive Comparison of eFuture Holding's Degree of Financial Leverage

For the Software - Application subindustry, eFuture Holding'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.

eFuture Holding's Degree of Financial Leverage Distribution in the Software Industry

For the Software industry and Technology sector, eFuture Holding's Degree of Financial Leverage distribution charts can be found below:

* The bar in red indicates where eFuture Holding's Degree of Financial Leverage falls into.

eFuture Holding Degree of Financial Leverage Calculation

eFuture Holding's Degree of Financial Leverage for the quarter that ended in Sep. 2016 is calculated as:

Degree of Financial Leverage	=	% Change in Earnings per Share (Diluted)^**	/	% Change in EBIT
	=	( 0.07 (Sep. 2016) / 0.187 (Sep. 2015) - 1 )	/	( -0.236 (Sep. 2016) / 1.605 (Sep. 2015) - 1 )
	=	-0.6257	/	-1.147
	=	0.55^***

** 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.

eFuture Holding (NAS:EFUT) 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.

eFuture Holding Degree of Financial Leverage Related Terms

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eFuture Holding (eFuture Holding) Business Description

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GURUFOCUS.COM » STOCK LIST » Technology » Software » eFuture Holding Inc (NAS:EFUT) » Definitions » Degree of Financial Leverage

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Address

Website

http://www.e-future.com.cn

E-Future Information Technology, Inc., established under the Cayman Islands Companies Law on November 2, 2000. The Company changed its name from 'e-Future Information Technology Inc.' to 'eFuture Information Technology Inc.' in December 2008. It provides software and services to China's retail and consumer goods industries. It offers one-stop, end-to-end integrated portfolio of software and services from factory to consumer on seven verticals: Fast Moving Consumer Goods (FMCG), Department Store, Shopping Mall, Grocery, Logistics, Specialty Store and Online Retailers. Its clients include manufacturers, distributors, resellers, logistics companies and retailers. The Company's client base encompasses corporations such as Procter & Gamble, Pepsi, L'Oreal, Kimberly-Clark, Gucci and B&Q as well as Chinese companies. The Company has three business lines: software, professional services and cloud service. Its software solutions include the management of merchandizing, distribution, warehousing, supply chains, customer relationships, logistics and points of sale. It consists of three deployable groups of products: Foundation Solutions, Collaborative Solutions and Intelligent Solutions. Foundation Solutions - are used to meet client needs for services such as retail management, point of sale ('POS'), distribution management, logistics management, warehouse management, vendor payment and control and loyalty card management. Collaborative Solutions - are used to meet client needs for services such as visual SCM and visual process management systems. Depending on the type of customer and their needs, clients use a variety of Collaborative Solutions. Intelligent Solutions - are used to meet client needs for services such as business intelligence, brand analysis, supplier relationship management and customer relationship management systems. Professional Services includes recurring maintenance and support services on existing software installations, delivery services, consulting services and outsourcing services. Maintenance and Support Service - is provided following the installation of its software solutions, as clients will typically require ongoing maintenance support and software upgrades to ensure the efficient operation of their system. Consulting Service - is provided by its consulting services group which consists of business consultants, systems analysts and technical personnel. Outsourcing Service - is flexible by design to meet its clients' changing requirements. Cloud Service consists of cloud services based on cloud computing architecture, such as Salesforce Automation. Its regional service centers in Beijing, Shanghai, Guangzhou, Wuhan, Qingdao, Xi'an, Fuzhou, Hangzhou, Nanjing, Chongqing and Shenzhen.