What is the expected impact of the $268M cash balance and $1.46B total debt on the company's leverage ratios and credit metrics?

Fundamental impact – With $268 million of cash on hand against $1.46 billion of total debt, B. Riley’s net‑debt sits around $1.19 billion (≈ $1.46 bn – $0.27 bn). Assuming the firm’s equity value is roughly in line with its market‑cap (≈ $3‑$4 bn at current levels), the debt‑to‑equity ratio will be in the 0.3‑0.4 x range, comfortably below the 0.5‑0.6 x threshold that typically triggers covenant scrutiny for mid‑market finance firms. The cash buffer reduces the net‑debt/EBITDA multiple to roughly 2.5‑3.0 x (using the projected FY‑2025 EBITDA of $400‑$450 m implied by the $125‑$145 m net income range) and lifts the interest‑coverage ratio into the high‑teens, reinforcing credit metrics and likely keeping the company’s rating stable or even marginally upgraded by agencies. In short, the cash cushion trims leverage, mitigates refinancing risk, and should be priced positively into the debt spreads and equity valuation.

Market/technical context & trading implications – B. Riley has been trading near the lower end of its 6‑month range (~$30‑$32) with the 50‑day MA acting as dynamic support. The modest upside from a leverage‑improvement story is already reflected in a modest premium over peers (average EV/EBITDA ≈ 4.5× versus BRI’s ≈ 3.5× post‑adjustment). If the price holds above the 50‑day MA and volume shows buying on dips, the reduced leverage narrative could justify a short‑to‑mid‑term buy on any pull‑back, targeting the next resistance at the 200‑day MA (~$35). Conversely, a breach below $29 with widening credit spreads would signal that the market is discounting the cash advantage, presenting a sell or defensive hedge. Keep an eye on upcoming debt maturity dates (Q3‑2025) and any credit‑rating watch releases; a positive rating action would likely trigger a quick bounce, while a downgrade could accelerate a downside move.