Installed Building Products Inc (IBP)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 835,100 | 830,200 | 832,193 | 541,957 | 545,031 |
| Total stockholders’ equity | US$ in thousands | 670,300 | 493,500 | 416,840 | 319,182 | 250,031 |
| Debt-to-capital ratio | 0.55 | 0.63 | 0.67 | 0.63 | 0.69 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $835,100K ÷ ($835,100K + $670,300K)
= 0.55
The debt-to-capital ratio of Installed Building Products Inc has shown a decreasing trend over the past five years, declining from 0.70 in 2019 to 0.57 in 2023. This indicates that the company has been progressively reducing its reliance on debt financing in relation to its total capital structure. A lower debt-to-capital ratio generally suggests a lower financial risk for the company, as it indicates a smaller proportion of debt in its overall capital mix. The downward trend in the ratio could be a positive sign of improved financial health and potentially better creditworthiness. It is important to note that a lower debt-to-capital ratio may also imply increased equity financing, which could suggest improved investor confidence in the company's operations and future prospects. Overall, the decreasing trend in the debt-to-capital ratio for Installed Building Products Inc reflects a positive shift towards a more balanced and sustainable capital structure.
Peer comparison
Dec 31, 2023