Fastenal Company (FAST)
Debt-to-capital ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 125,000 | 200,000 | 353,200 | 330,000 | 365,000 |
| Total stockholders’ equity | US$ in thousands | 3,616,300 | 3,348,800 | 3,163,200 | 3,042,200 | 2,733,200 |
| Debt-to-capital ratio | 0.03 | 0.06 | 0.10 | 0.10 | 0.12 |
December 31, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $125,000K ÷ ($125,000K + $3,616,300K)
= 0.03
The debt-to-capital ratio of Fastenal Company has shown a decreasing trend over the past five years according to the provided data. As of December 31, 2020, the ratio was 0.12, which indicates that 12% of the company's capital was funded through debt. By December 31, 2024, the ratio had decreased to 0.03, signaling a significant reduction in the proportion of debt in the company's capital structure.
This declining trend in the debt-to-capital ratio suggests that Fastenal Company has been gradually relying less on debt financing and potentially strengthening its financial position. A lower debt-to-capital ratio generally indicates lower financial risk and improved financial stability since the company is less dependent on borrowing to fund its operations and investments.
Overall, the decreasing debt-to-capital ratio of Fastenal Company over the five-year period reflects a positive trend towards a more conservative capital structure and improved financial health.
Peer comparison
Dec 31, 2024