What counts as a “good” debt to equity ratio will depend on the nature of the business and its industry. Generally speaking, a debt to equity ratio below 1.0 would be seen as relatively safe, whereas ratios of 2.0 or higher would be considered risky.

Creditors usually like a low debt to equity ratio because a low ratio (less than 1) is the indication of greater protection to their money. But stockholders like to get benefit from the funds provided by the creditors therefore they would like a high debt to equity ratio.