Paychex Inc (PAYX)
Debt-to-capital ratio
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 798,600 | 798,200 | 797,700 | 797,300 | 796,800 |
| Total stockholders’ equity | US$ in thousands | 3,801,000 | 3,493,200 | 3,085,200 | 2,948,000 | 2,781,400 |
| Debt-to-capital ratio | 0.17 | 0.19 | 0.21 | 0.21 | 0.22 |
May 31, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $798,600K ÷ ($798,600K + $3,801,000K)
= 0.17
The debt-to-capital ratio of Paychex Inc has shown a gradual decrease over the past five years, indicating a positive trend in the company's debt management. As of May 31, 2024, the ratio stands at 0.17, down from 0.22 in 2020. This suggests that the company has been reducing its reliance on debt financing relative to its total capital structure. A lower debt-to-capital ratio signifies a lower financial risk and greater financial stability for the company. Overall, this improving trend reflects sound financial management practices by Paychex Inc.