A gearing ratio is a category of financial ratgame ios that compare company debt relative khổng lồ financial metrics such as total equity or assets. Investors, lenders, & analysts sometimes use these types of ratgame ios lớn assess how a company structures itself và the amount of risk involved with its chosen capital structure.Bạn sẽ xem: Gearing ratio là gì
What Is a Gearing Ratio?
A gearing ratio is a measurement of a company's financial leverage, or the amount of business funding that comes from borrowed methods (lenders) versus company owners (shareholders). Well-known gearing rattiện ích ios include debt-to-equity, debt-to-capital & debt-service ratquả táo.
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Although financial leverage & financial risk are not the same, they are interrelated. Measuring the degree to lớn which a company uses financial leverage is a way to lớn assess its financial risk.
Lenders may use gearing ratios lớn decide whether or not khổng lồ extend credit, and investors may use them to determine whether or not to invest in a business. A higher gearing ratio usually indicates higher financial risk.
While there is no phối gearing ratio that indicates a good or bad structured company, general guidelines suggest that between 25% & 1/2 is best unless the company needs more debt khổng lồ operate.
How Do You Calculate a Gearing Ratio?
There are many types of gearing ratgame ios, but a comtháng one lớn use is the debt-to-equity ratio. To calculate it, you add up the long-term & short-term debt and divide it by the shareholder equity. If you don't have any shareholders, then you (the owner) are the only shareholder, & the equity in this equation is yours.
Long-term debt includes loans, leases, or any other size of debt that requires payments at least a year out. Short-term debt usually requires payment within a year.
How Gearing Ratquả táo Work
Raising capital by continuing lớn offer more shares would help decrease your gearing ratio. For example, if you managed lớn raise $50,000 by offering shares, your equity would increase to $125,000, và your gearing ratio would decrease khổng lồ 80%.
Another method to lớn decrease your gearing ratio is khổng lồ increase your sales in an attempt to increase revenue. You could also try lớn convince your lenders khổng lồ convert your debt inkhổng lồ shares.
Limitations of Gearing Rattiện ích ios
The results of gearing ratio analysis can add value to lớn a company's financial planning when compared over time. But as a one-time calculation, gearing ratquả táo may not provide any real meaning.
It's also important khổng lồ rethành viên that although high gearing ratio results indicate high financial leverage, they don't always mean that a company is in financial dicăng thẳng. While firms with higher gearing ratgame ios generally carry more risk, regulated entities such as utility companies commonly operate with higher debt levels.
Monopolistic companies often also have a higher gearing ratio because their financial risk is mitigated by their svào industry position. Additionally, capital-intensive industries, such as manufacturing, typically finance expensive equipment with debt, which leads khổng lồ higher gearing rattiện ích ios.A gearing ratio compares the funds a company borrows relative to its equity, or capital.Different types of gearing ratquả táo exist, but a comtháng one is the debt-to-equity ratio.A higher gearing ratio usually indicates higher financial risk to stockholders và lenders.It's important khổng lồ consider the industry và type of company when analyzing và comparing gearing ratgame ios.Chuim mục: Hỏi Đáp