HP Inc (HPQ)
Debt-to-capital ratio
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 9,254,000 | 10,796,000 | 6,386,000 | 5,543,000 | 4,780,000 |
| Total stockholders’ equity | US$ in thousands | -1,069,000 | -3,025,000 | -1,644,000 | -2,275,000 | -1,193,000 |
| Debt-to-capital ratio | 1.13 | 1.39 | 1.35 | 1.70 | 1.33 |
October 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $9,254,000K ÷ ($9,254,000K + $-1,069,000K)
= 1.13
The debt-to-capital ratio indicates the proportion of a company's capital that is financed through debt. HP Inc's debt-to-capital ratio has fluctuated over the past five years, with a noticeable decrease from 1.56 in 2020 to 1.13 in 2023. This downward trend suggests that HP Inc has been relying less on debt to finance its operations relative to its capital base. The reduction in the ratio may indicate improved financial stability and a lower risk of financial distress. However, it is essential to consider other factors such as interest rates and the company's ability to generate sufficient cash flow to service its debt obligations when evaluating the implications of this trend.
Peer comparison
Oct 31, 2023