Simpson Manufacturing Company Inc (SSD)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 410,625 | 433,125 | 0 | 0 | 0 |
| Total stockholders’ equity | US$ in thousands | 1,679,750 | 1,413,380 | 1,184,000 | 980,943 | 891,957 |
| Debt-to-capital ratio | 0.20 | 0.23 | 0.00 | 0.00 | 0.00 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $410,625K ÷ ($410,625K + $1,679,750K)
= 0.20
The debt-to-capital ratio of Simpson Manufacturing Co., Inc. has shown variability over the years. In 2023, the ratio stands at 0.22, indicating that debt accounts for 22% of the company's total capital structure. This suggests that the company is relying more on equity financing rather than debt to support its operations and growth initiatives. The decrease from the previous year's ratio of 0.29 may indicate a reduction in the company's debt levels relative to its capital base.
It is worth noting that for the years 2021, 2020, and 2019, the company reported a debt-to-capital ratio of 0.00, implying either minimal or no debt in those years. This could be due to various reasons such as strong cash flows, ample liquidity, or strategic decisions to operate with little to no debt obligations.
Overall, a lower debt-to-capital ratio suggests a lower financial risk and greater financial stability for Simpson Manufacturing Co., Inc. as it indicates a lower reliance on borrowed funds to support its operations and investments. However, it is essential to monitor future trends in this ratio to assess the company's evolving capital structure and financial health.
Peer comparison
Dec 31, 2023