Bristol-Myers Squibb Company (BMY)

Solvency ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Debt-to-assets ratio 0.51 0.52 0.52 0.50 0.39 0.35 0.37 0.37 0.36 0.38 0.37 0.36 0.36 0.36 0.38 0.40 0.41 0.33 0.33 0.33
Debt-to-capital ratio 0.74 0.74 0.74 0.75 0.55 0.53 0.52 0.52 0.53 0.53 0.53 0.54 0.52 0.52 0.54 0.54 0.56 0.45 0.46 0.46
Debt-to-equity ratio 2.91 2.84 2.87 3.00 1.25 1.11 1.08 1.10 1.13 1.13 1.14 1.19 1.10 1.07 1.15 1.18 1.28 0.82 0.85 0.86
Financial leverage ratio 5.67 5.46 5.56 6.01 3.23 3.15 2.92 2.96 3.12 3.01 3.08 3.26 3.04 2.98 3.01 2.99 3.13 2.50 2.61 2.59

The solvency ratios of Bristol-Myers Squibb Company indicate its ability to meet its long-term financial obligations and the level of financial risk it carries.

1. Debt-to-assets ratio: This ratio shows the proportion of the company's assets financed by debt. The trend for Bristol-Myers Squibb shows a relatively stable level around 0.30-0.40 until a notable increase to 0.50 by March 31, 2024. This indicates a higher reliance on debt to finance its assets, potentially increasing financial risk.

2. Debt-to-capital ratio: This ratio reflects the percentage of the company's capital structure that is financed by debt. Bristol-Myers Squibb's ratio fluctuated within the range of 0.45 to 0.55 until a significant rise to 0.75 by March 31, 2024. This suggests an increasing proportion of debt in the company's capital mix over time.

3. Debt-to-equity ratio: The debt-to-equity ratio measures the company's financial leverage and risk from its debt financing. Bristol-Myers Squibb's ratio remained relatively stable at around 1.00 until increasing to 3.00 by March 31, 2024. This sharp increase indicates a substantial rise in debt relative to equity, signaling higher financial risk.

4. Financial leverage ratio: This ratio indicates the extent to which the company uses debt to finance its operations. Bristol-Myers Squibb's financial leverage ratio showed a consistent trend around 3.00 until a significant surge to 6.01 by March 31, 2024. This points to a substantial increase in financial leverage, suggesting a higher level of financial risk and potential vulnerability to economic downturns.

In summary, the solvency ratios of Bristol-Myers Squibb Company demonstrate a trend of increasing reliance on debt financing over the years, leading to higher financial risk and leverage. Investors and stakeholders should closely monitor these ratios to assess the company's ability to meet its financial obligations and withstand economic challenges.

Coverage ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Interest coverage -10.27 -8.19 -6.18 -3.50 8.23 8.52 8.47 8.35 7.25 7.10 6.92 6.54 7.06 -2.10 -1.98 -1.87 -3.85 3.56 3.09 3.74

The interest coverage ratio of Bristol-Myers Squibb Company has shown fluctuations over the period analyzed. The interest coverage ratio measures a company's ability to meet its interest payment obligations on outstanding debt. A ratio above 1 indicates that the company is generating enough operating income to cover its interest expenses.

From March 31, 2020, to September 30, 2022, the interest coverage ratio remained positive, indicating that Bristol-Myers Squibb Company was able to comfortably cover its interest expenses. The ratio improved gradually during this period, reaching a peak of 7.25 on December 31, 2022.

However, from March 31, 2023, to December 31, 2024, the interest coverage ratio turned negative, indicating that the company's operating income was not sufficient to cover its interest expenses. The ratio hit a low of -10.27 on December 31, 2024, suggesting a significant deterioration in the company's ability to service its debt.

It is crucial for Bristol-Myers Squibb Company to closely monitor its interest coverage ratio, as sustained negative ratios could signal financial distress and potential default on debt obligations. Management may need to implement strategies to improve profitability and cash flow generation to enhance the company's ability to meet its interest payments.

See also:

Bristol-Myers Squibb Company Solvency Ratios (Quarterly Data)