UFP Technologies Inc (UFPT)
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 | 28,000 | 51,000 | 71,000 | 0 | — |
| Total stockholders’ equity | US$ in thousands | 286,091 | 237,545 | 194,446 | 176,893 | 161,991 |
| Debt-to-capital ratio | 0.09 | 0.18 | 0.27 | 0.00 | 0.00 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $28,000K ÷ ($28,000K + $286,091K)
= 0.09
The debt-to-capital ratio for UFP Technologies Inc has shown a declining trend over the past five years, indicating a decreasing reliance on debt financing relative to total capital employed. In 2019 and 2020, the company had a debt-to-capital ratio of 0.00, suggesting no debt in the capital structure during these periods.
However, as of December 31, 2023, the debt-to-capital ratio increased to 0.09. This indicates that debt financing has started to play a minor role in the company's capital structure compared to equity. The significant decrease in the ratio from 0.27 in 2021 to 0.09 in 2023 highlights a strategic shift towards a lower debt burden and potentially a stronger financial position in recent years.
Overall, the decreasing trend in the debt-to-capital ratio reflects a conservative financial approach by UFP Technologies Inc, which may reduce financial risk and enhance the company's ability to weather economic uncertainties.
Peer comparison
Dec 31, 2023