Nabors Industries Ltd (NBR)
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 | 2,511,520 | 2,537,540 | 3,262,800 | 2,968,700 | 3,333,220 |
| Total stockholders’ equity | US$ in thousands | 326,614 | 368,956 | 590,656 | 1,151,380 | 1,982,810 |
| Debt-to-equity ratio | 7.69 | 6.88 | 5.52 | 2.58 | 1.68 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $2,511,520K ÷ $326,614K
= 7.69
The debt-to-equity ratio of Nabors Industries Ltd has been showing a significant upward trend over the past five years. In 2019, the ratio stood at 1.68, indicating a moderate level of debt relative to equity. However, by the end of 2023, the ratio had surged to 9.62, suggesting a substantial increase in the company's reliance on debt financing compared to equity.
This escalating trend in the debt-to-equity ratio may raise concerns about the company's financial leverage and its ability to meet debt obligations in the long term. A higher debt-to-equity ratio signifies a higher financial risk and could potentially affect the company's creditworthiness in the eyes of investors and creditors.
It would be crucial for Nabors Industries Ltd to closely monitor and manage its debt levels going forward to ensure a healthy balance between debt and equity financing. Additionally, the company may need to consider strategies to reduce its reliance on debt and strengthen its financial position for sustainable growth and stability in the future.
Peer comparison
Dec 31, 2023