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GuruFocus has detected 6 Warning Signs with Varian Medical Systems Inc $VAR.
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Varian Medical Systems Inc (NYSE:VAR)
Debt-to-Equity
0.42 (As of Mar. 2017)

Varian Medical Systems Inc's current portion of long-term debt for the quarter that ended in Mar. 2017 was $269 Mil. Varian Medical Systems Inc's long-term debt for the quarter that ended in Mar. 2017 was $277 Mil. Varian Medical Systems Inc's total equity for the quarter that ended in Mar. 2017 was $1,289 Mil. Varian Medical Systems Inc's debt to equity for the quarter that ended in Mar. 2017 was 0.42.

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.

Varian Medical Systems Inc'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
=(379.6 + 287.5) / 1740.5
=0.38

Varian Medical Systems Inc's Debt to Equity Ratio for the quarter that ended in Mar. 2017 is calculated as

Debt to Equity=Total Debt / Total Equity
=(Current Portion of Long-Term Debt + Long-Term Debt) / Total Equity
=(269.3 + 277.2) / 1288.5
=0.42

* 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.

Varian Medical Systems Inc Annual Data

Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15Sep16
deb2equity 0.110.040.030.030.160.110.300.270.290.38

Varian Medical Systems Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
deb2equity 0.330.310.290.290.450.470.420.380.350.42
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