BorgWarner Inc (BWA)
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 | 3,707,000 | 4,140,000 | 4,261,000 | 3,738,000 | 1,674,000 |
| Total stockholders’ equity | US$ in thousands | 5,828,000 | 7,224,000 | 6,948,000 | 6,428,000 | 4,706,000 |
| Debt-to-capital ratio | 0.39 | 0.36 | 0.38 | 0.37 | 0.26 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $3,707,000K ÷ ($3,707,000K + $5,828,000K)
= 0.39
The debt-to-capital ratio of BorgWarner Inc has shown a fluctuating trend over the past five years, ranging from 0.29 to 0.39. This ratio measures the proportion of the company's total debt to its total capital, indicating the extent to which debt is used to finance its operations.
In 2023, the debt-to-capital ratio increased to 0.39 from 0.37 in 2022, suggesting a slightly higher reliance on debt as a source of funding relative to total capital. This could indicate increased borrowing or a decrease in capital base during the year.
Comparing the 2023 ratio to 2019, there has been a significant increase from 0.29, indicating a notable shift towards more debt financing over the past five years. This suggests a potential change in the company's capital structure and financing strategy over the period.
Overall, the varying debt-to-capital ratios highlight BorgWarner Inc's flexibility in adjusting its debt levels relative to capital and emphasize the importance of monitoring such ratios in assessing the company's leverage and financial risk profile.
Peer comparison
Dec 31, 2023