Deere & Company (DE)
Solvency ratios
| Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Nov 1, 2020 | Nov 3, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.39 | 0.44 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.64 | 0.72 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 1.78 | 2.53 | 0.00 |
| Financial leverage ratio | 4.78 | 4.44 | 4.56 | 5.80 | 6.40 |
The solvency ratios of Deere & Co. reflect the company's ability to meet its long-term obligations and remain financially stable. The debt-to-assets ratio has slightly increased from 0.58 in 2019 to 0.61 in 2023, indicating that 61% of the company's assets are financed by debt. Despite this increase, the ratio remains at a reasonable level.
Similarly, the debt-to-capital ratio has shown a slight increase from 0.72 in 2019 to 0.74 in 2023, suggesting that 74% of the company's capital is derived from debt. This indicates a reasonable level of leverage.
The debt-to-equity ratio has fluctuated over the years, but currently stands at 2.91 in 2023, compared to 3.97 in 2019. This indicates that the company's debt comprises 2.91 times the equity, highlighting a decreasing reliance on debt for financing.
The financial leverage ratio has also decreased over the years, from 6.40 in 2019 to 4.78 in 2023, indicating a reduction in financial risk and leverage.
Overall, the trends in these solvency ratios suggest that Deere & Co. has effectively managed its debt levels, reducing its reliance on debt and improving its financial stability over the years.
Coverage ratios
| Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Nov 1, 2020 | Nov 3, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 6.31 | 9.60 | 8.67 | 4.07 | 3.80 |
The interest coverage ratio measures a company's ability to meet its interest payment obligations from its operating income. For Deere & Co., the interest coverage ratio has demonstrated a positive trend over the past five years, indicating an improving ability to cover interest expenses.
In the most recent period, as of October 29, 2023, the interest coverage ratio stood at 143.08, reflecting a substantial improvement compared to the previous years. This signifies that the company's operating income is significantly more than sufficient to cover its interest expenses, demonstrating a strong ability to meet its financial obligations.
The substantial increase in the interest coverage ratio from 7.00 in November 1, 2020, to 143.08 in October 29, 2023, suggests that Deere & Co.'s profitability and cash flow have strengthened significantly, providing a cushion against interest rate increases or declining operating income.
Overall, the consistently improving interest coverage ratio reflects positively on the financial health and stability of Deere & Co., indicating a strong ability to service its debt and suggesting an increasing capacity to invest in growth opportunities.