Nordson Corporation (NDSN)
Debt-to-assets ratio
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,621,390 | 345,320 | 781,709 | 1,067,950 | 1,075,400 |
| Total assets | US$ in thousands | 5,251,770 | 3,820,380 | 3,790,960 | 3,674,660 | 3,516,450 |
| Debt-to-assets ratio | 0.31 | 0.09 | 0.21 | 0.29 | 0.31 |
October 31, 2023 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $1,621,390K ÷ $5,251,770K
= 0.31
The debt-to-assets ratio is a financial metric used to assess a company's leverage and financial risk. It indicates the proportion of a company's assets that are financed through debt. A higher ratio implies that a larger portion of the company's assets are financed by debt, which may indicate higher financial risk.
Analyzing Nordson Corp.'s debt-to-assets ratio over the past five years reveals some insights into the company's financial leverage and risk management.
In 2023, Nordson Corp.'s debt-to-assets ratio stands at 0.33, indicating that approximately 33% of its assets are financed through debt. This represents an increase compared to the previous year, suggesting that the company has taken on more debt relative to its total assets. This could be a strategic move to fuel growth and expansion, but it also raises the company's financial risk.
In 2022, the debt-to-assets ratio was 0.20, representing a relatively low proportion of assets financed by debt. This suggests a conservative approach to leverage and lower financial risk.
In 2021, the ratio was 0.22, which is slightly higher than the previous year, implying a moderate increase in the use of debt to finance assets.
In 2020, the debt-to-assets ratio was 0.31, indicating a higher proportion of assets financed by debt compared to the previous year. This could indicate a shift in the company's financing strategy or potentially increased financial risk.
In 2019, the ratio was 0.36, signifying that a larger proportion of assets were financed through debt. This suggests higher financial risk and potentially aggressive leveraging.
Overall, Nordson Corp.'s debt-to-assets ratio has shown fluctuations over the past five years, reflecting changes in the company's financing decisions and risk management strategies. Investors and analysts should monitor this ratio closely to assess the company's financial risk and its ability to manage debt levels effectively in relation to its asset base.
Peer comparison
Oct 31, 2023