The ratio is calculated by taking the company's long-term debt and dividing it by the book value of common equity. The greater a company's leverage, the higher the ratio. Generally, companies with higher ratios are thought to be more risky.
A high ratio usually indicates a higher degree of business risk because the company must meet principal and interest on its obligations. Potential creditors are reluctant to give financing to a company with a high debt position. However, the magnitude of debt depends on the type of business. For example, a bank may have a high debt ratio but its assets are generally liquid. A utility can afford a higher ratio than a manufacturer because its earnings are more stable.
| Ticker | Name | LT Debt / Equity % | StockRank™ |
|---|---|---|---|
| NSI:CURATECH | CURA Technologies | -123829.08 | 3 |
| NSQ:TLGT | Teligent Inc | -102481.94 | 22 |
| NSI:CANDC | C & C Constructions | -47836.26 | 28 |
| NGM:LIFE B | LifeAssays AB (publ) | -47366.67 | 3 |
| BOM:530977 | Shri Keshav Cements and Infra | -37520.31 | 46 |
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