Capital Intensive
Financial Dictionary — Finance & Capital Markets
Definition
Capital intensive is used to describe industries or sectors of the economy that require large investments in capital assets to produce their goods, such as the automobile industry. These companies need large profit margins and/or low borrowing costs to survive.
Use cases, Example & Why it matters
Use cases
- Used in capital markets for disclosure, valuation, and investor communication.
- Used when interpreting securities, filings, and market indicators.
- Used when interpreting securities, filings, and market indicators.
Example
- Example: Investors reference **Capital Intensive** when assessing risk/return and interpreting public disclosures.
Why it matters
- Why it matters: Improves transparency for investors and supports pricing, funding, and governance decisions.