Corteva Inc (CTVA)
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 | 2,434,000 | 1,172,000 | 1,120,000 | 1,166,000 | 114,000 |
| Total stockholders’ equity | US$ in thousands | 25,037,000 | 25,302,000 | 25,384,000 | 24,824,000 | 24,309,000 |
| Debt-to-capital ratio | 0.09 | 0.04 | 0.04 | 0.04 | 0.00 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $2,434,000K ÷ ($2,434,000K + $25,037,000K)
= 0.09
The debt-to-capital ratio of Corteva Inc has been gradually increasing over the past five years, indicating a higher level of financial leverage. In 2019, the ratio was exceptionally low at 0.00, suggesting a minimal reliance on debt to finance its operations. However, this ratio has been steadily climbing since 2020, reaching 0.09 by the end of 2023.
A higher debt-to-capital ratio signifies that a larger portion of Corteva's capital structure is financed through debt rather than equity. This can potentially increase financial risk as the company has higher obligations to meet in terms of interest payments and debt repayment. It also means that Corteva is more vulnerable to fluctuations in interest rates and may have limited financial flexibility during economic downturns.
It is important for investors and stakeholders to monitor changes in the debt-to-capital ratio over time, as a significant increase could signal that Corteva is taking on more debt to fuel growth or manage operations. Analyzing this ratio in conjunction with other financial metrics can provide a more comprehensive understanding of Corteva's overall financial health and risk profile.
Peer comparison
Dec 31, 2023