CVS Health Corp (CVS)
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 | — | — | — | — | 64,699,000 |
| Total stockholders’ equity | US$ in thousands | 76,461,000 | 71,469,000 | 75,075,000 | 69,389,000 | 63,864,000 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.50 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $76,461,000K)
= 0.00
The debt-to-capital ratio of CVS Health Corp has shown a decreasing trend over the past five years, decreasing from 0.52 in 2019 to 0.45 in 2023. This indicates a decreasing reliance on debt financing relative to the company's total capital structure. The downward trend suggests that CVS Health Corp has been progressively reducing its debt levels or increasing its capital base through equity financing or retained earnings.
A lower debt-to-capital ratio generally signifies improved financial health and reduced financial risk, as the company has a lower proportion of debt in its capital structure compared to equity. It can also indicate a stronger ability to meet debt obligations and potentially lower interest costs associated with servicing debt.
Overall, the decreasing trend in CVS Health Corp's debt-to-capital ratio suggests a positive financial position and prudent management of its capital structure over the past five years.
Peer comparison
Dec 31, 2023