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Sonic Corp (NAS:SONC)
Debt to Equity
7.45 (As of Aug. 2014)

Sonic Corp's current portion of long-term debt for the quarter that ended in Aug. 2014 was $16.2 Mil. Sonic Corp's long-term debt for the quarter that ended in Aug. 2014 was $450.6 Mil. Sonic Corp's total equity for the quarter that ended in Aug. 2014 was $62.7 Mil. Sonic Corp's debt to equity for the quarter that ended in Aug. 2014 was 7.45.

A high debt to equity ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense.


Definition

Debt to Equity measures the financial leverage a company has.

Sonic Corp's Debt to Equity Ratio for the fiscal year that ended in Aug. 2014 is calculated as

Debt to Equity=Total Debt / Total Equity
=(Current Portion of Long-Term Debt + Long-Term Debt) / Total Equity
=(16.162 + 450.577) / 62.675
=7.45

Sonic Corp's Debt to Equity Ratio for the quarter that ended in Aug. 2014 is calculated as

Debt to Equity=Total Debt / Total Equity
=(Current Portion of Long-Term Debt + Long-Term Debt) / Total Equity
=(16.162 + 450.577) / 62.675
=7.45

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

In the calculation of Debt to Equity, we use the total of Current Portion of Long-Term Debt and Long-Term Debt divided by Total Equity. In some calculations, Total Liabilities is used to for calculation.


Be Aware

Because a company can increase its Return on Equity by having more financial leverage, it is important to watch the leverage ratio when investing in high Return on Equity companies.


Related Terms

Current Portion of Long-Term Debt, Long-Term Debt, Total Equity, Return on Equity


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Sonic Corp Annual Data

Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13Aug14
deb2equity 0.250.41-7.02-12.43-173.1528.2510.338.726.177.45

Sonic Corp Quarterly Data

May12Aug12Nov12Feb13May13Aug13Nov13Feb14May14Aug14
deb2equity 10.618.7210.469.927.936.175.5210.208.127.45
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