Debt-to-Equity Ratio

The Debt-to-Equity (D/E) ratio measures how much a company relies on borrowed money versus shareholder equity to fund its operations; a ratio of 1.04x means debt is 4% higher than equity, indicating moderate leverage.

Compared to the sector median of 0.73x, HSIC’s ratio is higher, placing it in the 66th percentile among peers—meaning it uses more debt than roughly two-thirds of comparable companies. The ratio has generally increased over the last eight quarters, but the year-over-year change is unavailable, while the quarter-over-quarter change shows a -9.6% decline from the prior quarter. This combination of a level above the median but a recent quarterly decrease suggests leverage has been elevated, yet the latest drop may signal a cautious reduction in borrowing. For investors, the current high debt position relative to peers could introduce additional financial risk, but the downward quarterly trend might ease those concerns over time. This metric supports the NEUTRAL verdict because it identifies a risk factor (above-average leverage) that is partially offset by a recent improvement, aligning with a balanced outlook.

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