Clearwater Paper Corporation (CLW)
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 | 462,300 | 564,900 | 637,600 | 716,400 | 884,500 |
| Total stockholders’ equity | US$ in thousands | 668,800 | 572,100 | 511,700 | 521,100 | 432,000 |
| Debt-to-equity ratio | 0.69 | 0.99 | 1.25 | 1.37 | 2.05 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $462,300K ÷ $668,800K
= 0.69
The debt-to-equity ratio of Clearwater Paper Corp has shown a decreasing trend over the past five years. In 2019, the ratio was the highest at 2.09, indicating a higher reliance on debt to finance the company's operations compared to equity. However, there has been a consistent decline in this ratio since then, reaching 0.69 by the end of 2023.
This decline suggests that Clearwater Paper Corp has been reducing its debt levels relative to equity, which could signal an improvement in the company's financial health and lower financial risk. A lower debt-to-equity ratio indicates a stronger equity position and financial stability, as the company is relying less on debt financing.
Overall, the decreasing trend in Clearwater Paper Corp's debt-to-equity ratio reflects a positive development in the company's capital structure and financial leverage, potentially enhancing its ability to withstand economic downturns and pursue growth opportunities in a more sustainable manner.