Topbuild Corp (BLD)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,373,030 | 1,417,260 | 1,454,480 | 683,396 | 697,955 |
| Total stockholders’ equity | US$ in thousands | 2,563,660 | 1,929,710 | 1,636,430 | 1,348,790 | 1,152,890 |
| Debt-to-capital ratio | 0.35 | 0.42 | 0.47 | 0.34 | 0.38 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,373,030K ÷ ($1,373,030K + $2,563,660K)
= 0.35
The debt-to-capital ratio of TopBuild Corp has shown fluctuation over the past five years, ranging from 0.34 to 0.48. In general, a lower debt-to-capital ratio indicates a lower level of financial risk for the company as it suggests a higher proportion of capital is funded by equity rather than debt. The downward trend from 2021 to 2023 may signal a positive development towards a more conservative capital structure and reduced reliance on debt financing. However, it is important to further assess the company's overall financial health and its ability to service its debt obligations. Additional analysis, considering other financial metrics and industry benchmarks, would provide a more comprehensive understanding of TopBuild Corp's leverage position.