Keysight Technologies Inc (KEYS)

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	1,195,000	1,793,000	1,791,000	1,789,000	1,788,000
Total stockholders’ equity	US$ in thousands	4,654,000	4,161,000	3,784,000	3,297,000	3,004,000
Debt-to-capital ratio		0.20	0.30	0.32	0.35	0.37

October 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,195,000K ÷ ($1,195,000K + $4,654,000K)
= 0.20

The debt-to-capital ratio is a financial metric that indicates the proportion of a company's capital that is contributed by debt. It reflects the extent to which a company relies on debt financing as opposed to equity financing. Here's a detailed analysis of Keysight Technologies Inc's debt-to-capital ratio based on the provided data:

1. Trend Analysis: The trend in Keysight Technologies Inc's debt-to-capital ratio over the past five years indicates a general decrease. This indicates a positive trend as the company is relying less on debt financing compared to its total capital.

2. Oct 31, 2023 (0.28): The debt-to-capital ratio for October 31, 2023, stands at 0.28, indicating that 28% of the company's capital is funded by debt. This suggests a relatively conservative approach to capital structure, with a larger proportion funded by equity.

3. Oct 31, 2022 (0.30): In the previous year, the ratio was slightly higher at 0.30, signifying a decrease in reliance on debt financing compared to 2023. This could indicate effective management of the company's capital structure.

4. Oct 31, 2021 (0.32): The trend of decreasing debt-to-capital ratio continues in 2021, with the ratio at 0.32. This represents a gradual reduction in the proportion of capital funded by debt over the years.

5. Oct 31, 2020 (0.35): The ratio for 2020 stands at 0.35, which, although higher than the ratios in subsequent years, still reflects a declining reliance on debt in the capital structure compared to the previous years.

6. Oct 31, 2019 (0.37): In 2019, the debt-to-capital ratio was at 0.37, showing a higher reliance on debt compared to the later years. However, there has been a consistent downward trend in subsequent years, indicating a shift towards a more balanced and sustainable capital structure.

In conclusion, the decreasing trend in Keysight Technologies Inc's debt-to-capital ratio reflects a conservative approach to capital structure with a declining reliance on debt financing. This suggests effective management in balancing the use of debt and equity to fund the company's operations and investments.