Resideo Technologies Inc (REZI)
Debt-to-capital ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,396,000 | 1,397,000 | 1,400,000 | 1,402,000 | 1,404,000 | 1,407,000 | 1,410,000 | 1,412,000 | 1,220,000 | 1,222,000 | 1,184,000 | 1,186,000 | 1,155,000 | 1,141,000 | 1,140,000 | 1,149,000 | 1,158,000 | 1,165,000 | 1,169,000 |
| Total stockholders’ equity | US$ in thousands | 2,749,000 | 2,645,000 | 2,677,000 | 2,604,000 | 2,529,000 | 2,400,000 | 2,394,000 | 2,361,000 | 2,252,000 | 2,158,000 | 2,103,000 | 2,032,000 | 1,993,000 | 1,605,000 | 1,495,000 | 1,521,000 | 1,602,000 | 1,573,000 | 1,593,000 |
| Debt-to-capital ratio | 0.34 | 0.35 | 0.34 | 0.35 | 0.36 | 0.37 | 0.37 | 0.37 | 0.35 | 0.36 | 0.36 | 0.37 | 0.37 | 0.42 | 0.43 | 0.43 | 0.42 | 0.43 | 0.42 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,396,000K ÷ ($1,396,000K + $2,749,000K)
= 0.34
The debt-to-capital ratio of Resideo Technologies Inc has been relatively stable over the past eight quarters, ranging between 0.44 and 0.48. This ratio measures the proportion of total debt to the total capital employed by the company, indicating the extent to which the company relies on debt financing compared to equity.
With the ratio hovering around 0.44 to 0.48, it suggests that Resideo Technologies Inc's capital structure has been moderately leveraged, with a significant portion of its capital being financed through debt. A decreasing trend from 0.46 in Q4 2022 to 0.44 in Q4 2023 may indicate a slight improvement in the company's debt position relative to its capital base.
However, it is important to note that a higher debt-to-capital ratio can indicate higher financial risk, as the company may face challenges in servicing its debt obligations, especially during economic downturns. On the other hand, too low a ratio could signal underutilization of debt financing and potential missed opportunities for leveraging financial leverage for growth and expansion.
Overall, the stability of Resideo Technologies Inc's debt-to-capital ratio over the past eight quarters suggests a consistent financing strategy, but further analysis of the company's overall financial health and debt management policies would provide a more comprehensive understanding of its financial leverage position.