PriceSmart Inc (PSMT)

Debt-to-equity ratio

		Aug 31, 2024	Aug 31, 2023	Aug 31, 2022	Aug 31, 2021	Aug 31, 2020
Long-term debt	US$ in thousands	94,443	119,487	103,556	110,110	112,610
Total stockholders’ equity	US$ in thousands	1,122,960	1,107,040	991,073	915,345	831,719
Debt-to-equity ratio		0.08	0.11	0.10	0.12	0.14

August 31, 2024 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $94,443K ÷ $1,122,960K
= 0.08

The debt-to-equity ratio of PriceSmart Inc has shown a decreasing trend over the past five years, indicating a favorable financial position in terms of leveraging debt compared to equity. In 2024, the ratio stands at 0.08, representing a lower proportion of debt relative to equity in the company's capital structure. This improvement suggests that PriceSmart has been gradually reducing its reliance on debt financing, which can be perceived positively by investors and creditors alike. The declining trend from 2020 to 2024 indicates a prudent management strategy towards maintaining a healthy balance between debt and equity, which can contribute to the company's long-term financial stability and growth prospects.