Cars.com Inc (CARS)

Debt-to-equity ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Long-term debt	US$ in thousands	460,119	429,679	434,210	438,739	458,249	482,740	495,968	499,182	457,383	470,520	502,357	524,260	576,143	558,720	609,066	763,361	611,277	630,913	644,046	652,178
Total stockholders’ equity	US$ in thousands	492,108	483,010	477,457	384,987	384,430	376,527	391,388	396,087	398,020	394,574	385,456	374,016	368,190	322,373	328,781	347,890	1,141,070	1,141,480	1,569,150	1,592,670
Debt-to-equity ratio		0.93	0.89	0.91	1.14	1.19	1.28	1.27	1.26	1.15	1.19	1.30	1.40	1.56	1.73	1.85	2.19	0.54	0.55	0.41	0.41

December 31, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $460,119K ÷ $492,108K
= 0.93

The debt-to-equity ratio for Cars.com has shown fluctuations over the past eight quarters. In Q1 2022, the ratio was at its highest at 1.29, indicating that the company had more debt relative to equity. Subsequently, the ratio increased further to 1.32 in Q2 2022 before starting a downward trend in the following quarters.

The ratio decreased to 1.30 in Q3 2022 and continued to decline to 1.23 in Q4 2022. This downward trend persisted into 2023, with the ratio dropping to 1.18 in Q1 2023 and reaching its lowest point at 0.93 in Q3 2023. However, the ratio then increased slightly to 0.94 in Q2 2023 and further to 0.98 in Q4 2023.

Overall, the debt-to-equity ratio of Cars.com has shown variability but has generally been on a decreasing trend since Q1 2022. A lower ratio indicates that the company is relying less on debt financing relative to equity, which can be viewed positively by investors and creditors as it signifies a stronger financial position and lower financial risk.