Addus HomeCare Corporation (ADUS)

Debt-to-equity ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	124,132	131,772	220,912	193,901	59,164
Total stockholders’ equity	US$ in thousands	706,694	633,540	574,344	518,676	475,592
Debt-to-equity ratio		0.18	0.21	0.38	0.37	0.12

December 31, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $124,132K ÷ $706,694K
= 0.18

The debt-to-equity ratio of Addus HomeCare Corporation has shown fluctuations over the past five years. In 2023, the ratio decreased to 0.18 from 0.21 in 2022, indicating a lower level of financial leverage and reliance on debt financing. This trend suggests that the company has reduced its debt relative to equity, which may help improve its financial stability and flexibility.

Comparing the 2023 ratio to the levels seen in 2021 and 2020, which stood at 0.38, there has been a significant improvement in leveraging. This indicates that Addus HomeCare Corporation has made efforts to reduce its debt levels or increase its equity position, leading to a more balanced capital structure.

In 2019, the debt-to-equity ratio was notably lower at 0.13, indicating a higher proportion of equity relative to debt compared to the subsequent years. This suggests that the company may have increased its debt in the following years to support its growth or investment activities.

Overall, the decreasing trend in the debt-to-equity ratio from 2021 onwards, reaching a lower point in 2023, indicates a positive shift towards a more conservative financing structure. It suggests that the company may be managing its debt levels more prudently, which could enhance its financial strength and reduce risks associated with high leverage.