Managing Your Money

Long-Term Debt-to-Equity Ratio Definition

Long-Term Debt-to-Equity Ratio Definition

Long Term Debt-to-Equity Definition. A long-term debt-to-equity ratio is a measure investors and lenders use to assess the risk a company presents. The long-term debt ratio is the portion of a firm’s capital that comes from borrowing for more than one year, expressed as a proportion of shareholders’ equity. A high ratio means more debt and thus more risk. Excessive long-term debt can indicate a firm is unable to generate enough capital from profits or selling stock to meet investment needs. Too much debt, both short-term and long-term, means a firm is less likely to be able to meet its debt obligations. Should the company become insolvent, there is less chance that selling off assets will raise enough cash to pay the debt.
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What Are Acccounts Receivable (AR)? Definition, Meaning & Examples

Accounts receivable or "AR" are credit sales. A business has ...more
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What Is Revenue? Definition, Types, Formula & Examples

Revenue is the money a company earns from selling its goods and ...more
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Opportunity Cost: Definition, Examples & How to Calculate

Opportunity cost is the loss of one alternative’s value when you ...more
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How to Estimate the Value of a Bearer Bond

How to Estimate the Value of a Bearer Bond. Bearer bonds have not ...more
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What Is Net Income (NI)? Definition, Formula & How to Calculate

Simply put, net income is the amount of money that is left over when ...more
Managing-your-money

Choose the Right ETFs for Your Portfolio.

What Is a Stakeholder? Definition, Types & Examples
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What Is a Stakeholder? Definition, Types & Examples

Return on Investment (ROI): Definition, Formula & How to Calculate
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Return on Investment (ROI): Definition, Formula & How to Calculate

Return on Equity (ROE): Formula & What It Is
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Return on Equity (ROE): Formula & What It Is

Mutual Fund Gross vs. Net Expense Ratio
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Mutual Fund Gross vs. Net Expense Ratio

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