It only makes sense to treat operating leases as debt if it’s a liquidation play. It is overly punitive to treat leasing w/ a healthy, growing business as debt (e.g. $SFM). Leases are much more akin to an operating expense, why most people don’t see that is beyond me.https://twitter.com/LAForeverHall/status/1205984606672998401 …
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They’re clearly liabilities. I just don’t see how capitalizing them and equating them to debt helps one ascertain the underlying economic reality of a going-concern. Thanks for the link, interesting read!
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Agreed
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