Gentherm Inc (THRM)

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	222,217	232,653	36,250	189,934	78,124
Total stockholders’ equity	US$ in thousands	644,722	672,273	653,806	586,331	484,096
Debt-to-equity ratio		0.34	0.35	0.06	0.32	0.16

December 31, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $222,217K ÷ $644,722K
= 0.34

The debt-to-equity ratio of Gentherm Inc has shown variability over the past five years, ranging from 0.06 to 0.35. In 2021, the company had a significantly low debt-to-equity ratio of 0.06, indicating a conservative approach to financing its operations and investments primarily through equity rather than debt. This suggests a low level of financial risk and reliance on external borrowing.

However, the ratio increased in 2022 and 2023 to 0.35, signaling a higher level of debt relative to equity. This increase may be due to the company taking on additional debt to fund growth opportunities, acquisitions, or other strategic initiatives. While the ratio of 0.35 is still moderate and indicates a healthy balance between debt and equity, investors should monitor future trends to ensure the company is managing its debt levels prudently.