SolarEdge Technologies Inc (SEDG)

Debt-to-equity ratio

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Long-term debt	US$ in thousands	329,614	638,703	628,115	627,381	626,647	625,914	625,182	624,451	623,721	622,991	622,263	1,243,070	620,808	620,082	619,357	1,146,700	570,332	—	—	173
Total stockholders’ equity	US$ in thousands	956,366	2,106,190	2,240,550	2,411,910	2,490,410	2,520,190	2,350,790	2,176,370	2,052,130	2,027,530	2,010,520	1,310,040	1,242,080	1,177,790	1,099,920	1,085,760	1,032,040	924,801	866,418	811,670
Debt-to-equity ratio		0.34	0.30	0.28	0.26	0.25	0.25	0.27	0.29	0.30	0.31	0.31	0.95	0.50	0.53	0.56	1.06	0.55	0.00	0.00	0.00

September 30, 2024 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $329,614K ÷ $956,366K
= 0.34

The debt-to-equity ratio of SolarEdge Technologies Inc has shown a decreasing trend over the past few quarters, indicating a favorable position in terms of financial leverage. The ratio has consistently declined from 1.06 as of December 31, 2020, to 0.34 as of September 30, 2024.

This decreasing trend suggests that the company has been reducing its reliance on debt financing in favor of equity financing. A lower debt-to-equity ratio typically indicates a lower level of financial risk and greater financial stability.

It is worth noting that the ratio did spike to 0.95 as of December 31, 2021, which may have been a result of a significant increase in debt relative to equity during that period. However, the company has since managed to bring the ratio back down to more acceptable levels.

Overall, a declining debt-to-equity ratio is generally viewed positively by investors and creditors as it signals that the company is managing its capital structure effectively and moving towards a more balanced and sustainable financial position.