Terex Corporation (TEX)
Debt-to-equity ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | — | 773,600 | 668,500 | 1,166,200 | 1,168,800 |
| Total stockholders’ equity | US$ in thousands | 1,672,300 | 1,181,200 | 1,109,600 | 921,500 | 932,300 |
| Debt-to-equity ratio | 0.00 | 0.65 | 0.60 | 1.27 | 1.25 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $—K ÷ $1,672,300K
= 0.00
The debt-to-equity ratio of Terex Corp. has shown a declining trend over the past five years, indicating a more conservative capital structure. In 2023, the ratio decreased to 0.37 from 0.66 in 2022, demonstrating a significant reduction in financial leverage. This could imply that the company has been paying down its debt or increasing its equity base.
Compared to the high ratio of 1.27 in 2020 and 1.26 in 2019, Terex Corp. has made substantial improvements in managing its debt levels relative to its equity. A lower debt-to-equity ratio suggests reduced financial risk and potentially lower interest expenses, positively impacting the company's financial stability and creditworthiness.
Overall, the decreasing trend in Terex Corp.'s debt-to-equity ratio indicates a more prudent approach to capital structure management, which may provide the company with greater financial flexibility and resilience in the long term.