Debt to Equity question

Discussion in 'Stocks' started by WhiteOut56, Dec 15, 2011.

  1. Looking at yahoo finance key stats

    StockA: Debt to equity of 100
    StockB: Debt to equity of 20

    .... long story short stock A has more debt

    all things considered equal if interest rates rise...

    Should stockB outperform stockA?
  2. 1) The growth rates and P/E ratios should have more bearing on the stock performance.
    2) A company can have "a lot" of debt but if the debt is invested in a high-growth business, interest rate increases won't matter. :cool:
  3. I understand that...

    but if interest rates rise 1% for the day.... should that have an affect on the company w/ more debt?

  4. But usually the debt is used for crap acquisitions. Like HP buying Palm and then throwing away the entire technology a few months later.

    Microsoft buying Danger for 1.2 billion and then throwing out the tech a few months later.

    Usually the debt is used for acquisitions that end up falling into goodwill and expensed out over the years.
  5. If only someone would buyout AAPL. :eek: :p :D :cool: