debt/equity ratio

(redirected from Debt-Equity Ratio)

Debt/equity ratio

Indicator of financial leverage. Compares assets provided by creditors to assets provided by shareholders. Determined by dividing long-term debt by common stockholder equity.

Debt/Equity Ratio

In risk analysis, a way to determine a company's leverage. The ratio is calculated by taking the company's long-term debt and dividing it by the value of its common stock. Put graphically:

Debt/equity ratio = Long-term debt / Common stock

The greater a company's leverage, the higher the ratio. Generally, companies with higher ratios are thought to be more risky because they have more liabilities and less equity. See also: Long-Term Debt/Capitalization Ratio.

debt/equity ratio

The ratio of mortgage debt to the owner's equity in the property.Typical home mortgage lenders require a debt/equity ratio of 80 percent—meaning they will loan up to 80 percent of the value of the home.Higher ratios can be obtained by purchasing private mortgage insurance. Commercial lenders have varying requirements depending on particular market circumstances at the time.

References in periodicals archive ?
245 billion which is likely to be funded at a debt-equity ratio of 70:30, requiring an equity investment of $373 million and debt financing of $872 million.
It enables the group to strengthen its debt-equity ratio and increase its capitalization, both of which support Bunge's strategy for continued global growth.
The purpose of this authorization is to give the Board freedom to act in promoting the shareholders' interests through purchases and transfers of the Company's own stock, including, exercising this authority to work with the Company's debt-equity ratio and using own stock as payment in acquisitions.
The increase in net income, stockholders' equity and cash will substantially improve our financial position, enabling us to lower our debt-equity ratio and fund our aggressive growth plans for 1996 and beyond.
Impact of debt-equity ratio on profitability-An exploratory study of chemical industry.
As per Suvankar Sen, Executive Director of Senco Gold, Our funding plan targets a debt-equity ratio of 1:2.
Small business loans with a tenure of up to seven years plus one-year grace period and a debt-equity ratio of 90:10 will be disbursed across the country including Gilgit-Baltistana[euro]s Azad Jammu and Kashmir and the Federally Administered Tribal Areas.
Small business loans with tenure up to seven years and a debt-equity ratio of 90:10 will be disbursed to SME beneficiaries across Pakistan including four provinces, Gilgit-Baltistan, Azad Jammu and Kashmir and Federally Administered Tribal Areas (FATA).
Small business loans with tenure up to seven years and a debt-equity ratio of 90:10 will be disbursed to SME beneficiaries across Pakistan including four provinces' Gilgit-Baltistan' Azad Jammu and Kashmir and Federally Administered Tribal Areas (FATA).
The Gujarat project, likely to be completed by 2014, is being funded with a debt-equity ratio of 60:40.
The project will be completed with a debt-equity ratio of 70:30.