Emerson Electric Company (EMR)

Debt-to-equity ratio

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Long-term debt	US$ in thousands	7,610,000	8,259,000	5,793,000	6,326,000	4,277,000
Total stockholders’ equity	US$ in thousands	20,689,000	10,364,000	9,883,000	8,405,000	8,233,000
Debt-to-equity ratio		0.37	0.80	0.59	0.75	0.52

September 30, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $7,610,000K ÷ $20,689,000K
= 0.37

The debt-to-equity ratio of Emerson Electric Co. has shown fluctuations over the past five years. In 2023, the ratio decreased to 0.39 from 1.00 in 2022, indicating a significant improvement in the company's financial leverage. This suggests that Emerson Electric Co. relied less on debt financing and had a stronger equity position relative to its debt in 2023. The decrease in the ratio may signify enhanced financial stability and reduced financial risk. It's important to note that a low debt-to-equity ratio could imply that the company is not taking full advantage of leverage, potentially missing out on the tax advantages of debt financing. However, overall, the decrease in the ratio in 2023 suggests a positive trend in the company's capital structure.