Essay: Disney has the highest debt to equity ratio
The values given by the debt to equity ratio would be of interest to stockholders because it reflects the part of the business that is financed by borrowing. These figures help the company realize the amount of debt they have to pay and how much profit they need to make in order to pay the debts.
By comparison Disney has the highest debt to equity ratio between the three companies. The higher debt to equity ratio simply means that the company will be able to borrow less money and has to rely more on the investments of the stock holders. Looking at the performance of Ford Corporation it is clear that the economic challenges that faced the automotive industry in 2008 and 2009 affected ford. By the end of 2008 they had %35 billion in debt and over $1.8 billion annual interest expense Forbes (2010). This presented ford with serious discounted prices. To remain competitive with other automotive industries ford needs to restructure their balance sheet. They need to improve their financial profile and avoid the fate of that many automotive companies experienced in the recession. This period saw ford approach their global restructuring advisor Blackstone that built for them recapitalization and financial models that analyzed the impact of the transactions.
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