Equity ratio
What share of total assets is financed with the company's own money.
The equity ratio is equity divided by total assets, as a percentage. It says how much of what the company owns is funded by equity rather than by debt.
The higher it is, the more a company can absorb a bad year without defaulting. What counts as normal varies widely by industry: capital-intensive businesses run on more debt than service firms.
It can be calculated from the balance sheet alone, so it is available for nearly every company that files — unlike the margins, which need an income statement.
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