Advance Auto Parts Inc (AAP)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,786,360 | 1,188,280 | 1,034,320 | 1,032,980 | 747,320 |
| Total stockholders’ equity | US$ in thousands | 2,519,730 | 2,599,190 | 3,129,450 | 3,559,510 | 3,549,080 |
| Debt-to-capital ratio | 0.41 | 0.31 | 0.25 | 0.22 | 0.17 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,786,360K ÷ ($1,786,360K + $2,519,730K)
= 0.41
The debt-to-capital ratio of Advance Auto Parts Inc has shown a consistent upward trend from 0.17 in 2019 to 0.41 in 2023. This indicates an increasing reliance on debt financing in relation to total capital employed by the company over the past five years. A higher debt-to-capital ratio implies a higher proportion of debt in the capital structure, which can increase financial risk and interest expenses. It is essential for investors and stakeholders to closely monitor this ratio to assess the company's financial health and debt management strategies.
Peer comparison
Dec 31, 2023