D/E Ratio

The D/E ratio relates a company’s debt to its equity and indicates the extent to which the company is financed by external capital. A high D/E ratio indicates a greater reliance on debt financing and increased financial risk, whereas a low leverage ratio suggests a solid equity base and higher financial stability.

The data (i.e., book values of debt and equity) used for the D/E ratio is based on the most recent financial information published by the respective companies (in annual or semi-annual reports).

For comparison purposes, we have calculated the median of the D/E ratios of these companies. The bar charts additionally illustrate the interquartile range (IQR) for each sector, based on the full set of D/E ratios of the individual companies in each sector. The IQR represents the middle 50% of observations in each sector, i.e. the range between the first and third quartiles.

The financial services sector (including banks, insurance companies, etc.) was excluded.