shares of sp global inc spgi rose by 2222 in the past three months when understanding a companies price change over a time period like 3 months it could be helpful to look at its financials one key aspect of a companies financials is its debt but before we understand the importance of debt lets look at how much debt sp global has according to the sp globals most recent financial statement as reported on april 27 2023 total debt is at 1166 billion with 1073 billion in longterm debt and 93600 million in current debt adjusting for 140 billion in cashequivalents the company has a net debt of 1026 billion lets define some of the terms we used in the paragraph above current debt is the portion of a companys debt which is due within 1 year while longterm debt is the portion due in more than 1 year cash equivalents includes cash and any liquid securities with maturity periods of 90 days or less total debt equals current debt plus longterm debt minus cash equivalents shareholders look at the debtratio to understand how much financial leverage a company has sp global has 6202 billion in total assets therefore making the debtratio 019 as a rule of thumb a debtratio more than 1 indicates that a considerable portion of debt is funded by assets a higher debtratio can also imply that the company might be putting itself at risk for default if interest rates were to increase however debtratios vary widely across different industries a debt ratio of 25 might be higher for one industry but average for another why shareholders look at debt besides equity debt is an important factor in the capital structure of a company and contributes to its growth due to its lower financing cost compared to equity it becomes an attractive option for executives trying to raise capital interestpayment obligations can impact the cashflow of the company having financial leverage also allows companies to use additional capital for business operations allowing equity owners to retain excess profit generated by the debt capital looking for stocks with low debttoequity ratios check out benzinga pro a market research platform which provides investors with nearinstantaneous access to dozens of stock metrics  including debttoequity ratio click here to learn more this article was generated by benzingas automated content engine and reviewed by an editor