Envestnet Inc (ENV)

Debt-to-capital ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	876,612	871,769	848,862	756,503	305,513
Total stockholders’ equity	US$ in thousands	568,191	754,567	957,089	976,337	869,094
Debt-to-capital ratio		0.61	0.54	0.47	0.44	0.26

December 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $876,612K ÷ ($876,612K + $568,191K)
= 0.61

The debt-to-capital ratio for Envestnet Inc. has been on an upward trend over the past five years, indicating an increasing reliance on debt to finance its operations and investments. In 2019, the ratio stood at 0.39, and since then, it has steadily increased to 0.61 by the end of 2023. This suggests that a larger portion of Envestnet's capital structure is funded by debt compared to equity.

The rise in the debt-to-capital ratio may be driven by various factors such as strategic expansion, acquisitions, or investments in technology and infrastructure. While debt can provide companies with leverage and tax advantages, a higher ratio also signifies higher financial risk and potential challenges in meeting debt obligations.

Investors and creditors typically monitor the debt-to-capital ratio as a measure of a company's financial health and leverage levels. Envestnet's increasing ratio implies a need for careful management of debt levels and prudent financial decision-making to ensure sustainable growth and financial stability in the long term.