Reading Financial Data - Step by Step / Cash flow & returns
Reading leverage
Liabilities / equity compares what a company owes with owners' equity.
Concept
grepcent labels this ratio as liabilities / equity, not debt / equity, because it uses total liabilities.
Worked Example: Compute JPM liabilities / equity
- JPM liabilities were $4,062.5 billion in fiscal 2025.
- JPM stockholders' equity was $362.4 billion.
- Liabilities / equity = $4,062.5 billion / $362.4 billion = 11.21.
- Banks naturally carry large liabilities because deposits and other funding sit on the balance sheet.
- Read the ratio as a balance-sheet structure fact, then compare only with context.
See it live
Sources
Informational only - not investment advice.