TE Connectivity Ltd (TEL)
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 | 3,332,000 | 3,529,000 | 3,292,000 | 3,589,000 | 3,452,000 |
| Total stockholders’ equity | US$ in thousands | 12,486,000 | 11,551,000 | 10,897,000 | 10,748,000 | 9,495,000 |
| Debt-to-capital ratio | 0.21 | 0.23 | 0.23 | 0.25 | 0.27 |
September 30, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $3,332,000K ÷ ($3,332,000K + $12,486,000K)
= 0.21
The debt-to-capital ratio of TE Connectivity Ltd has shown a decreasing trend over the five-year period from 2020 to 2024, indicating a reduction in the company's reliance on debt to finance its operations. In 2020, the ratio was 0.27, and it has progressively decreased to 0.21 in 2024. This suggests that TE Connectivity Ltd has been able to strengthen its capital structure by reducing its debt levels in relation to its total capital.
A lower debt-to-capital ratio is generally viewed positively by investors and creditors as it signifies lower financial risk and greater financial stability. It may also indicate that the company has improved its ability to meet its debt obligations and fund its operations through equity or retained earnings.
Overall, the decreasing trend in TE Connectivity Ltd's debt-to-capital ratio reflects a potential improvement in the company's financial health and prudent management of its capital structure.
Peer comparison
Sep 30, 2024