Copart Inc (CPRT)
Debt-to-capital ratio
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | — | 11,006 | 1,996 | 397,636 | 396,900 |
| Total stockholders’ equity | US$ in thousands | 7,548,560 | 5,987,440 | 4,625,600 | 3,529,200 | 2,489,520 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.10 | 0.14 |
July 31, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $7,548,560K)
= 0.00
The debt-to-capital ratio measures the proportion of a company's capital structure that is financed by debt. Looking at the trend for Copart Inc over the past five years, we observe a consistent decline in the debt-to-capital ratio from 0.14 in July 2020 to 0.10 in July 2021, and then a further decrease to 0.00 in the subsequent years up to July 2024.
A debt-to-capital ratio of 0.00 in the most recent year indicates that the company has no debt in its capital structure, and its capital is solely derived from equity. This can be seen as a positive sign of financial strength and stability, as the company is not burdened by interest payments and has a lower risk of default.
The decreasing trend in the debt-to-capital ratio suggests that Copart Inc has been actively reducing its reliance on debt financing over the years, which could be a strategic move to strengthen its financial position and improve its creditworthiness. It also indicates that the company may have been able to generate sufficient cash flows from operations or equity financing to fund its operations and investments without the need for additional debt.
Overall, the declining debt-to-capital ratio for Copart Inc reflects a prudent capital structure management strategy that aims to minimize financial risk and enhance long-term sustainability.
Peer comparison
Jul 31, 2024