OSI Systems Inc (OSIS)

Debt-to-equity ratio

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Long-term debt	US$ in thousands	129,383	136,491	48,668	276,421	267,072
Total stockholders’ equity	US$ in thousands	863,483	726,165	638,424	639,820	572,152
Debt-to-equity ratio		0.15	0.19	0.08	0.43	0.47

June 30, 2024 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $129,383K ÷ $863,483K
= 0.15

The debt-to-equity ratio of OSI Systems Inc has shown fluctuations over the past five years. In particular, the ratio decreased from 0.47 in 2020 to 0.08 in 2022, indicating a significant reduction in the level of debt relative to equity during this period. However, in subsequent years, the ratio increased to 0.19 in 2023 and further to 0.15 in 2024, suggesting a higher proportion of debt compared to equity.

A lower debt-to-equity ratio generally indicates a lower level of financial risk, as the company relies less on borrowed funds to finance its operations. Conversely, a higher ratio implies increased financial leverage and potential risk, as a larger portion of the company's assets is financed through debt.

It is important to assess the reasons behind the fluctuations in the debt-to-equity ratio, such as changes in borrowing levels, repayment of debts, or fluctuations in equity. Investors and stakeholders should closely monitor these dynamics to evaluate the company's financial health and management of capital structure.