Debt: what the metrics mean
How much a company owes relative to its equity and assets, and whether earnings cover the interest.
Total Debt / Equity (TTM) — debt to equity
How much borrowed money there is for every dollar of the company's own. A measure of financial leverage: it amplifies both profit and loss, and in a crisis it decides who survives until the recovery. Norms differ a lot — utilities and REITs carry large debt by the nature of the business.
Net Long Debt / Assets (TTM) — net long-term debt to assets
Long-term debt minus cash, divided by total assets. What part of the company's property in effect belongs to its creditors.
Total Debt / Capital (TTM) — debt share of capital
All debt divided by debt plus equity: what part of the business is financed with borrowed money. Unlike Debt / Equity, it does not blow up to infinity when equity is close to zero.
Interest Coverage (TTM) — interest coverage
How many times operating earnings cover interest on debt. Below one means the business does not even earn enough to service its debt; a safety margin starts somewhere around three or four.
Net Income / Total Debt (TTM) — earnings to debt
What part of its total debt the company earns in a year. The inverse is how many years of current earnings it would take to pay it off.