Sanmina Corporation (SANM)

Debt-to-capital ratio

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Long-term debt	US$ in thousands	299,823	312,327	329,237	311,572	329,249
Total stockholders’ equity	US$ in thousands	2,196,620	2,168,950	56,325	1,878,630	1,623,370
Debt-to-capital ratio		0.12	0.13	0.85	0.14	0.17

September 30, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $299,823K ÷ ($299,823K + $2,196,620K)
= 0.12

The debt-to-capital ratio of Sanmina Corporation has varied over the past five years, ranging from 0.12 to 0.85. In 2020, the ratio was at 0.17, showing an increase in 2021 to 0.14, followed by a significant spike in 2022 to 0.85. However, there was a notable decrease in 2023 to 0.13, and another decline in 2024 to 0.12.

The lower the debt-to-capital ratio, the less financial leverage a company has, indicating lower financial risk. The downward trend in the ratio from 2022 to 2024 suggests that Sanmina Corporation has been reducing its reliance on debt to finance its operations. This may be a positive signal to investors and creditors as it indicates improved financial health and potentially better debt management by the company. However, the ratio in 2022 was comparatively high at 0.85, which could have raised concerns about the company's debt levels and financial stability during that period.

Overall, the decreasing trend in the debt-to-capital ratio over the years, with the exception of 2022, indicates a potentially improving financial position for Sanmina Corporation in terms of managing its debt and capital structure.