Goodman Group's most recent debt to equity ratio, as of December 2024, is 0.21.
The debt-to-equity (D/E) ratio is a crucial financial metric that indicates the proportion of equity and debt a company uses to finance its assets. It provides insight into a company's financial leverage. A lower ratio generally indicates that a company relies less on debt financing, which can be seen as less risky by investors.
Goodman Group's Debt to Equity Ratio History
Here's a look at Goodman Group's (ASX: GMG) recent Debt/Equity ratios:
| Fiscal Year | Period Ending | Debt / Equity Ratio |
|---|---|---|
| Current | Dec '24 | 0.21 |
| FY 2022 | Jun '22 | 0.18 |
Understanding the Debt to Equity Ratio
- Financial Leverage: The D/E ratio highlights how much debt a company is using to finance its assets relative to the value of shareholders' equity.
- Risk Assessment: A high D/E ratio can indicate higher financial risk, as the company might have difficulty servicing its debt obligations, especially during economic downturns. Conversely, a low D/E ratio often suggests a more conservative financing approach and greater financial stability.
- Industry Comparison: What constitutes a "good" or "bad" D/E ratio can vary significantly by industry. For instance, capital-intensive industries like real estate (which Goodman Group operates in) often have higher D/E ratios compared to technology companies, due to the nature of their assets and operations.
Goodman Group's ratios of 0.21 and 0.18 suggest a relatively low reliance on debt compared to equity, indicating a strong financial position with manageable leverage.
