Louisiana-Pacific Corporation (LPX)
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 | 347,000 | 346,000 | 346,000 | 348,000 | 348,000 |
| Total stockholders’ equity | US$ in thousands | 1,557,000 | 1,433,000 | 1,235,000 | 1,234,000 | 991,000 |
| Debt-to-equity ratio | 0.22 | 0.24 | 0.28 | 0.28 | 0.35 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $347,000K ÷ $1,557,000K
= 0.22
Louisiana-Pacific Corp.'s debt-to-equity ratio has shown a declining trend over the past five years, decreasing from 0.35 in 2019 to 0.22 in 2023. This indicates that the company has been gradually relying less on debt and more on equity to finance its operations and growth. A lower debt-to-equity ratio is generally viewed favorably by investors and creditors as it suggests a lower level of financial risk and potential for financial distress.
The decreasing trend in the debt-to-equity ratio could indicate that Louisiana-Pacific Corp. has been effectively managing its debt levels and improving its financial health. It may also imply that the company is generating sufficient profits and cash flows to support its growth without the need for significant additional debt.
Overall, the decreasing debt-to-equity ratio suggests that Louisiana-Pacific Corp. has been moving towards a more conservative capital structure, which could enhance its financial stability and flexibility in the long term.
Peer comparison
Dec 31, 2023