Fastenal Company (FAST)
Debt-to-equity 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-equity ratio | 0.03 | 0.06 | 0.11 | 0.11 | 0.13 |
December 31, 2024 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $125,000K ÷ $3,616,300K
= 0.03
Fastenal Company's debt-to-equity ratio has exhibited a declining trend over the past five years, reflecting sound financial management in terms of leverage. The ratio decreased from 0.13 in December 2020 to 0.03 in December 2024. This signals that the company has been able to reduce its reliance on debt financing in relation to equity over this period. A lower debt-to-equity ratio typically indicates lower financial risk and greater solvency for the company, as there is a smaller proportion of debt in the capital structure compared to equity. Fastenal's decreasing ratio suggests a conservative approach to capital structure which may enhance investor confidence in the company's financial stability.
Peer comparison
Dec 31, 2024