Wednesday, April 1, 2009

Long Term Debt

at the last IBD meeting, my question was regarding the debt % shown.
The stock was EPIQ; the long term debt was shown as 18%. I was confused because I had not seen debt represented that way.
I looked at Smartmoney - and the EPIQ LongTerm Debt/Equity ratio is .18%.
Obviously both figures are in line and represent the same degree of debt.
Smartmoney dictionary defines LongTermDebt/Equity Ratio;
A measure of a co. leverage, calculated by dividing its longterm debt by its shareholders equity, using figures from its most recent reported balance sheet.

(generally, a company with a Current Ratio of 1.0+ (cash) and a L/Tdebt ratio UNDER .50%
is considered to be in a strong position and utilizing cash well. )