Accenture plc (ACN)
Debt-to-equity ratio
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 25,692,800 | 22,106,100 | 19,529,500 | 17,000,500 | 14,409,000 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
August 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $—K ÷ $25,692,800K
= 0.00
The debt-to-equity ratio measures the proportion of a company's financing that comes from creditors compared to its shareholders. A low debt-to-equity ratio indicates that the company has been financing its growth primarily through equity rather than debt.
Looking at the data for Accenture plc, we can see a consistent pattern of very low debt-to-equity ratios over the past five years. In fact, the company's debt-to-equity ratio has been at 0.00 for the last four years, and only slightly higher at 0.01 in the most recent period.
This suggests that Accenture plc has maintained a very conservative capital structure, relying significantly on equity financing and having minimal reliance on debt. A low or zero debt-to-equity ratio is often perceived as a positive indicator, as it implies lower financial risk and a strong financial position. It also indicates that the company is not highly leveraged, which can be beneficial during economic downturns or times of financial instability.
However, it is important to note that while a low debt-to-equity ratio may indicate financial stability, it could also imply that the company is not taking advantage of potential tax benefits associated with debt financing. Additionally, a company with a very low debt-to-equity ratio may be missing out on the benefits of leverage in a low-interest-rate environment. Therefore, while a low debt-to-equity ratio is generally positive, it is not without potential drawbacks.
Overall, the consistently low debt-to-equity ratios for Accenture plc suggest a conservative and financially stable capital structure, which may be viewed positively by investors and creditors alike.
Peer comparison
Aug 31, 2023