over the past three months shares of novo integrated sciences inc nvos moved lower by 4578 before having a look at the importance of debt lets look at how much debt novo integrated sciences has according to the novo integrated sciencess most recent financial statement as reported on july 14 2022 total debt is at 1951 million with 1140 million in longterm debt and 811 million in current debt adjusting for 1268 million in cashequivalents the company has a net debt of 684 million 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 investors look at the debt ratio considering novo integrated sciencess 7179 million in total assets the debtratio is at 027 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 however due to interestpayment obligations cashflow of a company can be impacted 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