Fundamental Glossary / Debt & Financial Stability
Debt-to-Asset Ratio
Debt as a share of total assets.
Formula
Total debt / total assets.
What it means
The ratio says what fraction of the asset base is funded by borrowings. The rest is funded by other liabilities and by equity.
It is a stock measure. It does not say whether the assets earn enough to pay the interest.
How to read it
A low ratio is a conservative balance sheet only if the assets are real. Debt to inflated intangibles looks safer than it is.
What to watch
Total assets include cash. A company can borrow, hold the cash, and show both a higher debt-to-asset ratio and a large cash pile. Net debt tells that story more clearly.
This note explains the term. It is not a research recommendation, a target price, or a comment on any security. Ratios and regulatory thresholds change; use the latest filing or circular for a live figure.