Topbuild Corp (BLD)
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 | 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-equity ratio | 0.54 | 0.73 | 0.89 | 0.51 | 0.61 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $1,373,030K ÷ $2,563,660K
= 0.54
The debt-to-equity ratio of TopBuild Corp has fluctuated over the past five years, indicating varying levels of reliance on debt financing relative to shareholder equity. In 2023, the ratio decreased to 0.56 from 0.76 in 2022, suggesting a more conservative capital structure with less debt relative to equity. This could be a positive sign, indicating a potentially lower financial risk and improved financial stability.
Comparing to 2021 when the ratio was 0.92, the decrease in 2023 shows a significant improvement in the company's debt management.
On the other hand, the ratio in 2020 and 2019 was 0.52 and 0.64, respectively, indicating a lower level of debt compared to equity during those years. The decreasing trend in the ratio from 2020 to 2022, followed by an increase in 2023, indicates potential changes in the company's financing strategy and capital structure over the years.
Overall, the decreasing trend in the debt-to-equity ratio from 2021 through 2023 suggests that TopBuild Corp may be moving towards a more balanced capital structure with a reduced reliance on debt financing, which could positively impact its financial health and stability in the long run.