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TABLE OF CONTENTS• What Is the Debt Ratio?• What Does It Tell You?• Special Considerations• Long-Term Debt to Asset Ratio• Examples• Debt Ratios FAQsWhat Is the Debt Ratio?The term debt ratio refers to a financial ratio that measures the extent of a company’s leverage. The debt ratio is defined as the ratio of total debt to total assets, expressed as a decimal or percentage. It can be interpreted as the proportion of a company’s assets that are financed by debt. A ratio greater than 1 shows that a considerable portion of a company's debt is funded by assets, which means the company has more liabilities than assets. A high ratio indicates that a company may be at risk of default on its loans if interest rates suddenly rise. A ratio below 1 means that a greater portion of a company's assets

As Elon Musk Completes Massive Sale Of Shares...Tesla (TSLA) Chief Executive Elon Musk has defied big odds and consistently beat expectations since taking the helm of the electric-vehicle manufacturer in 2008. Now, with Musk having sold billions Musk is selling a 10% ownership stake in the electric car company, a process that caused Tesla stock to fall but is just about finished. Musk recently said that he'd sold "enough stock" to reach his goal. "There are still a few tranches left, but almost done," he tweetedMusk sold more than 934,000 Tesla shares, valued at around $928.6 million, to cover tax withholdings, according to regulatory filings. He also exercised more than 2.1 million Tesla stock options. His Tesla stock holdings now top 177 million shares.The stock sale began after Tesla re

The next automotive stock on our list needs no introduction. GM is one of the major legacy automakers, and one of Detroit’s most storied names. The company is the largest of the Big Three automakers, and its product portfolio includes some famous nameplates: Buick, Cadillac, and GMC, to give just a few.The company has seen its stock gain by an impressive 37% year-to-date even as revenues have slipped over the course of the year. For Q3, the top line came in at $26.7 billion, down from $34.1 billion reported in Q2, and down 24% from the year-ago quarter. Earnings have also slipped; the $1.52 reported was the lowest since the pandemic-induced loss of 50 cents per share in 2Q20.While revenues and earnings showed declines, GM’s market share showed a more complicated picture. The company’s sale

Stake to shareholders as dividend• Chinese gaming and social media company Tencent will hand a $16.4 billion JD.com stake as a dividend to its shareholders, weakening its ties to the e-commerce firm.• JD.com shares plunged 11.2% in early trade in Hong Kong on Thursday, the biggest daily percentage decline since its debut in the city in June 2020, while Tencent shares rose 5.7%.• Tencent, which first invested in JD.com in 2014, said it was the right time to transfer its stake given the e-commerce firm has reached a stage where it can self-finance its growth.In this article• 9618-HK+1.60 (+0.62%)• 700-HK-1.60 (-0.35%) Chinese gaming and social media company Tencent will hand a $16.4 billion JD.com stake as a dividend to its shareholders, weakening its ties to the e-commerce firm and raising

Equities with the disruptive growth label are sagging this year, disappointing investors who flocked to the nascent investment style as it was flourishing.Predictably, next-generation growth stocks are drawing sour tones and bearish commentary from analysts. That happens when stocks falter. However, disruptive growth as a style is itself enduring ample criticism, some of it directed toward exchange traded funds such as the ARK Innovation ETF (NYSEArca: ARKK).ARKK critics are out in force this year, far outnumbering the chorus that praised the actively managed ETF when it was soaring in 2020. It's easy to kick a fund when it's down, and ARKK's concentration is a point of contention, but that strategy could reward investors when innovative growth stocks rebound.“Historically and according to

Elon Musk says he is ‘almost done’ selling Tesla stockTesla Inc Chief Executive Officer Elon Musk, who has sold more than $15bn worth of shares in the company since early November, said on Wednesday that he was “almost done” with his stock sales.The billionaire had made confusing statements as to whether he might or might not be done with his stated goal of selling 10 percent of his Tesla shares.“I sold enough stock to get to around 10 percent plus the option exercise stuff and I tried to be extremely literal here,” he said in an interview on Tuesday with conservative satirical website Babylon Bee.But on Wednesday he suggested he might not be done. “This assumes completion of the 10b sale,” he tweeted, referring to his prearranged sales plan related to his options.“There are still a few tr

What Is a Debt Ratio?The debt ratio for a given company reveals whether or not it has loans and, if so, how its credit financing compares to its assets. It is calculated by dividing total liabilities by total assets, with higher debt ratios indicating higher degrees of debt financing. Debt ratios can be used to describe the financial health of individuals, businesses, or governments. Investors and lenders calculate the debt ratio for a company from its major financial statements, as they do with other accounting ratios.Whether or not a debt ratio is good depends on the contextual factors. But it's actually hard to come up with an absolute number. Keep reading to learn more about what these ratios mean and how they're used by corporations.KEY TAKEAWAYS• Whether or not a debt ratio is "good"

bid to block shareholder proposal on forced labour .The U.S. Securities and Exchange Commission has declined an effort by Apple Inc to skip a shareholder proposal asking the iPhone maker to provide greater transparency in its efforts to keep forced labour out of its supply chain.A group of shareholders earlier this year asked Apple's board to prepare a report on how the company protects workers in its supply chain from forced labour. The request for information covered the extent to which Apple has identified suppliers and sub-suppliers that are a risk for forced labour, and how many suppliers Apple has taken action against.In a letter from the SEC reviewed by Reuters on Wednesday, regulators denied Apple's move to block the proposal, saying that "it does not appear that the essential obje

Tesla Loses All the Gains From 35% Rally Stoked by Hertz Electric Vehicle DealTesla Inc.’s stock went on a tear after an October deal with Hertz Global Holdings Inc. signalled broader mainstream adoption of its electric cars.But that 35% rally is gone now.Tesla slid 3.5% on Monday, closing at $899.94. That put the shares below where they’d closed right before the $4.2 billion Hertz deal was revealed on Oct. 25.The stock, which peaked on Nov. 4, is down 21% in December, poised for the worst month since the pandemic-fueled rout in March 2020.Hertz’s order for 100,000 vehicles had sent Elon Musk-led Tesla’s shares on a near-vertical rise, pushing the company’s valuation well above the coveted trillion-dollar mark. Yet, the rally soon started wobbling after Musk started offloading some of his

Always Cut Your Losses ShortIn the battle for investment survival, you can learn a lot from judo. The first and most important lesson in that martial art is the same for the stock market today: damage control.And it's especially true when the market is heading into a major correction, such as the coronavirus stock market crash that began on Feb. 25, 2020, as the IBD Big Picture column noted the same day.Judo masters begin not by learning how to throw, but how to fall. They practice this skill until it's as natural as breathing. No matter how many times they're flipped, they can rise to fight again.Highly successful stock pickers go through similar training: They must learn how to cut their losses short. This means selling a stock when it's down 7% or 8% from your purchase price.Sounds simp