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GuruFocus has detected 4 Warning Signs with TE Connectivity Ltd $TEL.
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TE Connectivity Ltd (NYSE:TEL)
Debt-to-Equity
0.46 (As of Dec. 2016)

TE Connectivity Ltd's current portion of long-term debt for the quarter that ended in Dec. 2016 was $1,052 Mil. TE Connectivity Ltd's long-term debt for the quarter that ended in Dec. 2016 was $2,976 Mil. TE Connectivity Ltd's total equity for the quarter that ended in Dec. 2016 was $8,837 Mil. TE Connectivity Ltd's debt to equity for the quarter that ended in Dec. 2016 was 0.46.

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.

TE Connectivity Ltd's Debt to Equity Ratio for the fiscal year that ended in Sep. 2016 is calculated as

Debt to Equity=Total Debt / Total Equity
=(Current Portion of Long-Term Debt + Long-Term Debt) / Total Equity
=(331 + 3739) / 8485
=0.48

TE Connectivity Ltd's Debt to Equity Ratio for the quarter that ended in Dec. 2016 is calculated as

Debt to Equity=Total Debt / Total Equity
=(Current Portion of Long-Term Debt + Long-Term Debt) / Total Equity
=(1052 + 2976) / 8837
=0.46

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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 local exchange's currency.

TE Connectivity Ltd Annual Data

Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15Sep16
deb2equity 0.300.290.350.340.360.470.360.430.410.48

TE Connectivity Ltd Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
deb2equity 0.430.460.460.440.410.450.520.490.480.46
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