Equity Multiplier financial definition of Equity Multiplier. Equity Multiplier finance term by the Free Online Dictionary.

Equity multiplier

Total assets divided by total common stockholders' equity; the total assets per dollar of stockholders' equity.

Leverage Ratio

In risk analysis, any ratio that measures a company's leverage. One example of a gearing ratio is the long-term debt/capitalization ratio, which is calculated by taking the company's long-term debt and dividing it by its long-term debt added to its preferred and common stock. Another example is a simple debt-to-equity ratio, which is calculated by dividing total debt by total equity. Generally, companies with higher leverage as determined by a leverage ratio are thought to be more risky because they have more liabilities and less equity. A leverage ratio is also called a gearing ratio or an equity multiplier.

Equity Multiplier

What Does Equity Multiplier Mean?

A measure of financial leverage calculated as Total Assets/Total Stockholders' Equity. Like all debt management ratios, the equity multiplier is a way of examining how a company uses debt to finance its assets. Also known as the financial leverage ratio or leverage ratio.

Investopedia explains Equity Multiplier

In other words, this ratio shows a company's total assets per dollar of stockholders' equity. A higher equity multiplier indicates higher financial leverage, which means the company is relying more on debt to finance its assets.

Related Terms:
• Asset
• Current Ratio
• Debt/Equity Ratio
• Leverage
• Shareholders' Equity

Mentioned in	?		References in periodicals archive	?		Financial browser	?		Full browser	?
Financial Leverage Ratios Gearing Gearing Ratio Leverage Ratio Leverage Ratios	Marketing and shareholder value The principal key performance indicator for shareholder value is ROE (return on equity), which has two drivers, ROA (return on assets), and the equity multiplier (reciprocal of capital/assets ratio) or leverage factor. Strategic Planning That Computes by Bettinger, Cass / ABA Bank Marketing [2] The urban banks also tend to be more leveraged, as indicated by their higher equity multiplier (the ratio of assets to equity capital). Wall Street Meets Main Street: Rural Banking in the Natural State by Philpot, James; Payne, Thomas H. / Arkansas Business Data Analysis We tested the first hypothesis by examining the return on assets (ROA) and return on equity (ROE), profit margin (MARGIN) and equity multiplier (MULTIPLIER) of firms over a 14 year period, 1982-1995. The effects of organizational stability and leadership structure on ... by Sridharan, Uma V.; St. John, Caron H. / Journal of Managerial Issues	Equity Accounting Equity Arbitrage equity buildup Equity Cap Equity Capital Markets Department Equity Carve Out Equity Carve-Out Equity Claim Equity collar equity commitment note Equity Contribution Agreement equity dividend equity financing Equity floor Equity Fund Equity Funding Equity Income Equity injection Equity Kicker Equity Linked Foreign Exchange Option equity loan Equity Market Equity Market Capitalization Equity Market Neutral equity method Equity Multiplier Equity Note equity of redemption Equity Option Equity Options equity participation Equity Participation Loan equity REIT Equity Risk Premium Equity Security equity sharing loan equity stripping Equity Swap Equity Unit Investment Trust Equity Warrant Equity Withdrawal equity yield rate Equity-Indexed Annuity Equity-Linked Eurobond Equity-Linked Eurobonds Equity-Linked Policies Equity-Linked Policy Equityholders Equivalencia Equivalencia de rendimiento Equivalent Annual Annuity	Equity Linked Foreign Exchange Options Equity Linked Note Equity Linked Policies Equity Linked Policies Equity Linked Policy Equity Linked Policy Equity Linked Warrant Equity List Equity loan Equity loan Equity lona Equity looks upon that as done Equity market Equity market Equity market Equity market Equity Market Capitalization Equity Market Capitalization Equity market neutral Equity market neutral Equity Market Risk Premium Equity Marketing Hong Kong, Ltd. Equity Membership Candidate equity method equity model Equity Mortgage Equity Mortgage Equity Mortgage Equity Mortgage Equity Mortgage Equity Multiplier Equity Multipliers Equity Non-Hedge equity note Equity Notes equity of redemption equity of redemption equity of redemption Equity Office Media Network Equity Office Properties Trust equity option Equity options equity participation Equity Participation Investment Program equity participation loan Equity Participation Loans Equity Participation Note Equity premium Equity premium puzzle Equity Premiums Equity Principal Audition Equity Providing Preferred Income Convertible Securities Equity Quantitative Trading Group Equity Real Estate Investment Trust Equity Real Estate Investment Trusts Equity REIT Equity REITs

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References in periodicals archive

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Financial Leverage Ratios
Gearing
Gearing Ratio
Leverage Ratio
Leverage Ratios

Marketing and shareholder value The principal key performance indicator for shareholder value is ROE (return on equity), which has two drivers, ROA (return on assets), and the equity multiplier (reciprocal of capital/assets ratio) or leverage factor.

Strategic Planning That Computes by Bettinger, Cass / ABA Bank Marketing

[2] The urban banks also tend to be more leveraged, as indicated by their higher equity multiplier (the ratio of assets to equity capital).

Wall Street Meets Main Street: Rural Banking in the Natural State by Philpot, James; Payne, Thomas H. / Arkansas Business

Data Analysis We tested the first hypothesis by examining the return on assets (ROA) and return on equity (ROE), profit margin (MARGIN) and equity multiplier (MULTIPLIER) of firms over a 14 year period, 1982-1995.

The effects of organizational stability and leadership structure on ... by Sridharan, Uma V.; St. John, Caron H. / Journal of Managerial Issues

Equity Capital Markets Department

equity commitment note

Equity Contribution Agreement