Pure Storage Inc (PSTG)
Debt-to-capital ratio
| Feb 4, 2024 | Feb 5, 2023 | Feb 6, 2022 | Jan 31, 2021 | Feb 2, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 100,000 | 0 | 786,779 | 755,814 | 477,007 |
| Total stockholders’ equity | US$ in thousands | 1,270,090 | 941,233 | 754,336 | 750,006 | 830,118 |
| Debt-to-capital ratio | 0.07 | 0.00 | 0.51 | 0.50 | 0.36 |
February 4, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $100,000K ÷ ($100,000K + $1,270,090K)
= 0.07
The debt-to-capital ratio of Pure Storage Inc has exhibited fluctuations over the past five years. In particular, the ratio was relatively low in the most recent fiscal year, as of February 4, 2024, at 0.07, indicating a lower reliance on debt to finance the company's operations relative to its capital structure. This suggests a healthier financial position with a lower debt burden compared to the previous years.
Conversely, there was a significant decrease in the debt-to-capital ratio from the preceding year as of February 5, 2023, where the ratio was 0.00, implying either a decrease in debt levels or an increase in capital employed during that period. The abrupt change to a zero ratio may signal various financial events such as debt repayments, equity issuance, or fluctuations in the company's capital structure.
Furthermore, in the fiscal year ending February 6, 2022, the debt-to-capital ratio stood at 0.51, indicating that more than half of the company's capital was financed through debt. This high level of indebtedness relative to capital may pose financial risks such as higher interest payments and leverage.
Similarly, in fiscal year 2021 and 2020, as of January 31, 2021, and February 2, 2020, respectively, Pure Storage Inc maintained a stable debt-to-capital ratio around 0.50 and 0.36. These levels suggest a consistent reliance on debt financing throughout the period, with the company having a moderate debt burden compared to its capital structure.
In conclusion, the trend in Pure Storage Inc's debt-to-capital ratio demonstrates variability over the years, reflecting changes in the company's financing decisions and capital structure. The latest ratio of 0.07 indicates a more conservative approach to debt management, potentially enhancing the company's financial stability and flexibility.
Peer comparison
Feb 4, 2024