Harmony Biosciences Holdings (HRMY)

Debt-to-equity ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Long-term debt	US$ in thousands	178,566	189,647	189,984	194,250
Total stockholders’ equity	US$ in thousands	466,992	402,838	186,507	97,180
Debt-to-equity ratio		0.38	0.47	1.02	2.00

December 31, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $178,566K ÷ $466,992K
= 0.38

Based on the data provided, Harmony Biosciences Holdings Inc's debt-to-equity ratio has been decreasing over the past four years. In 2020, the ratio was 2.00, indicating that the company had twice as much debt as equity. However, this ratio has shown a significant downward trend since then. By the end of 2023, the debt-to-equity ratio had decreased to 0.41, suggesting that the company had a lower level of debt relative to its equity.

This decreasing trend in the debt-to-equity ratio can be viewed positively as it indicates that Harmony Biosciences Holdings Inc has been progressively reducing its reliance on debt to finance its operations and growth. A lower debt-to-equity ratio is usually considered favorable as it signifies lower financial risk and a stronger financial position for the company. It also suggests that the company may have improved profitability and efficiency in managing its capital structure.

Overall, the decreasing debt-to-equity ratio of Harmony Biosciences Holdings Inc over the past four years reflects a positive trend towards a more balanced and sustainable capital structure, which may enhance the company's financial stability and long-term growth prospects.