Nordson Corporation (NDSN)
Debt-to-equity 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 stockholders’ equity | US$ in thousands | 2,598,060 | 2,294,380 | 2,159,130 | 1,758,990 | 1,581,040 |
| Debt-to-equity ratio | 0.62 | 0.15 | 0.36 | 0.61 | 0.68 |
October 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $1,621,390K ÷ $2,598,060K
= 0.62
The debt-to-equity ratio measures the extent to which a company is financed by debt relative to its equity. A higher ratio indicates a greater reliance on debt for financing, while a lower ratio suggests a healthier balance between debt and equity.
Based on the data provided for Nordson Corp., the trend in the debt-to-equity ratio over the past five years reflects notable fluctuations. In 2019, the ratio stood at 0.80, indicating a relatively high level of debt compared to equity. Subsequently, there was a substantial decrease in the ratio to 0.64 in 2020, followed by a further decrease to 0.39 in 2021, indicating a significant improvement in the company's debt position relative to equity.
However, in the most recent year, the debt-to-equity ratio increased to 0.67, signifying a higher reliance on debt compared to the previous year. The ratio remains lower than in 2019 but higher than in 2021 and 2022.
Overall, the fluctuations in Nordson Corp.’s debt-to-equity ratio suggest varying levels of reliance on debt for financing over the past five years. It's important for investors and analysts to closely monitor this trend to assess the company's financial risk and capital structure management.
Peer comparison
Oct 31, 2023