over the past three months shares of hewlett packard inc hpe increased by 2634 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 hewlett packard has according to the hewlett packards most recent financial statement as reported on december 8 2022 total debt is at 1266 billion with 785 billion in longterm debt and 480 billion in current debt adjusting for 416 billion in cashequivalents the company has a net debt of 849 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 to understand the degree of financial leverage a company has shareholders look at the debt ratio considering hewlett packards 5712 billion in total assets the debtratio is at 022 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 for example a debt ratio of 25 might be higher for one industry but normal for another 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 equity owners can keep excess profit generated from the debt capital when companies use the debt capital for its business operations 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