CAPITAL STRUCTURE DECISION

The Capital Structure Decision

The capital structure decision

Comparison of Soutwest Airlines and China Airlines

The last ratio that we would like to converse about is the debt to equity ratio. If it is high it means that a company is highly leveraged. Being highly leveraged may be good or not (Saita, 2007).

The Southwest Airlines Company has a debt to equity ratio of 0.33, the China Southern Airlines 1.82 and the industry 1.2.

Ratio

southwest airlines

china airlines

industry

Debt to Equity

0.33

1.82

1.2

The Southwest Airlines Company has a quarterly revenue growth of 9.1, which may seem like a good number. However, when we ...