FMC Corporation (FMC)
Debt-to-equity ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 3,023,600 | 2,733,200 | 2,731,700 | 2,929,500 | 3,031,100 |
| Total stockholders’ equity | US$ in thousands | 4,410,900 | 3,377,900 | 3,124,300 | 2,961,800 | 2,532,300 |
| Debt-to-equity ratio | 0.69 | 0.81 | 0.87 | 0.99 | 1.20 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $3,023,600K ÷ $4,410,900K
= 0.69
The debt-to-equity ratio of FMC Corp. has been showing a declining trend over the past five years, indicating an improvement in the company's financial leverage. The ratio decreased from 1.29 in 2019 to 0.90 in 2023. This signifies that the company has been relying less on debt financing relative to equity financing during this period.
A decrease in the debt-to-equity ratio can indicate a strengthening financial position, as lower debt levels compared to equity can reduce financial risk and improve the company's ability to service its debts. However, it is essential to analyze the reasons behind this trend further to understand if it is a result of debt reduction, equity issuance, or a combination of both.
Overall, the decreasing trend in the debt-to-equity ratio of FMC Corp. suggests a positive development in the company's capital structure and financial health. It indicates a more conservative approach to financing, which can enhance the company's stability and resilience to economic fluctuations.
Peer comparison
Dec 31, 2023