BorgWarner Inc (BWA)
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 | 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-equity ratio | 0.64 | 0.57 | 0.61 | 0.58 | 0.36 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $3,707,000K ÷ $5,828,000K
= 0.64
The debt-to-equity ratio of BorgWarner Inc has shown some fluctuations over the past five years. In 2019, the ratio was relatively low at 0.42, indicating a conservative capital structure with lower reliance on debt financing. However, this ratio increased to 0.59 in 2020 and remained at that level in 2022, suggesting a slight rise in debt relative to equity.
In 2021, there was a slight increase in the debt-to-equity ratio to 0.62, indicating a trend towards higher leverage. However, by the end of 2023, the ratio had further increased to 0.65, suggesting that the company has taken on more debt in relation to equity.
Overall, the upward trend in BorgWarner Inc's debt-to-equity ratio over the past five years indicates a potential shift towards a more debt-heavy capital structure. This could imply increased financial risk and interest expense for the company, as well as a potential reduction in financial flexibility. It would be important for stakeholders to monitor this trend closely to assess the implications for the company's financial health and risk profile.
Peer comparison
Dec 31, 2023