BJs Wholesale Club Holdings Inc (BJ)

Debt-to-capital ratio

		Feb 3, 2024	Oct 28, 2023	Jul 29, 2023	Apr 29, 2023	Jan 28, 2023	Oct 29, 2022	Jul 30, 2022	Apr 30, 2022	Jan 29, 2022	Oct 30, 2021	Jul 31, 2021	May 1, 2021	Jan 30, 2021	Oct 31, 2020	Aug 1, 2020	May 2, 2020	Feb 1, 2020	Nov 2, 2019	Aug 3, 2019	May 4, 2019
Long-term debt	US$ in thousands	398,432	398,355	448,135	448,004	447,880	600,123	699,406	748,987	748,568	748,149	747,730	747,311	846,175	845,696	1,202,210	1,334,800	1,337,310	1,339,700	1,540,600	1,543,540
Total stockholders’ equity	US$ in thousands	1,458,850	1,353,700	1,231,290	1,131,730	1,046,840	942,875	853,591	721,342	648,108	567,736	488,352	413,524	319,327	217,378	119,101	32,497	-54,344	-104,486	-164,586	-148,309
Debt-to-capital ratio		0.21	0.23	0.27	0.28	0.30	0.39	0.45	0.51	0.54	0.57	0.60	0.64	0.73	0.80	0.91	0.98	1.04	1.08	1.12	1.11

February 3, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $398,432K ÷ ($398,432K + $1,458,850K)
= 0.21

The debt-to-capital ratio of BJs Wholesale Club Holdings Inc has been on an increasing trend over the past several quarters, indicating a greater reliance on debt financing relative to equity. The ratio stood at 0.21 as of February 3, 2024, but has steadily risen to 1.11 as of May 4, 2019. This upward trajectory suggests a growing proportion of the company's capital structure being funded by debt rather than equity.

A higher debt-to-capital ratio can signify increased financial leverage, which may potentially amplify returns for shareholders during favorable economic conditions. However, it also heightens the company's risk exposure, particularly in times of economic downturns or rising interest rates, as the company needs to meet debt obligations regardless of its operational performance.

Investors and creditors often assess the debt-to-capital ratio to evaluate a company's financial health and risk profile. BJs Wholesale Club Holdings Inc's escalating trend in this ratio may indicate a need for careful monitoring of its debt levels and the company's ability to manage its debt burden effectively in the long term.