Emerson Electric Company (EMR)
Debt-to-capital ratio
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 7,632,000 | 7,610,000 | 7,642,000 | 8,174,000 | 8,159,000 | 8,259,000 | 8,367,000 | 8,203,000 | 8,722,000 | 5,793,000 | 5,835,000 | 5,823,000 | 5,892,000 | 6,326,000 | 5,500,000 | 3,960,000 | 4,018,000 | 4,277,000 | 4,336,000 | 3,786,000 |
| Total stockholders’ equity | US$ in thousands | 20,674,000 | 20,689,000 | 20,464,000 | 11,360,000 | 10,727,000 | 10,364,000 | 10,315,000 | 10,575,000 | 10,249,000 | 9,883,000 | 9,291,000 | 9,130,000 | 8,895,000 | 8,405,000 | 7,831,000 | 7,517,000 | 8,421,000 | 8,233,000 | 8,755,000 | 8,526,000 |
| Debt-to-capital ratio | 0.27 | 0.27 | 0.27 | 0.42 | 0.43 | 0.44 | 0.45 | 0.44 | 0.46 | 0.37 | 0.39 | 0.39 | 0.40 | 0.43 | 0.41 | 0.35 | 0.32 | 0.34 | 0.33 | 0.31 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $7,632,000K ÷ ($7,632,000K + $20,674,000K)
= 0.27
The debt-to-capital ratio of Emerson Electric Co. has fluctuated over the period from Q2 2022 to Q1 2024. In Q1 2024, the ratio stood at 0.34, which indicates that 34% of the company's capital structure was financed by debt. This represents an increase from the previous quarter (Q4 2023) where the ratio was 0.28.
The trend over the past few quarters shows some variability, with the ratio increasing in Q1 2023 to 0.48, peaking at 0.53 in Q3 2022, and then gradually decreasing. This suggests that Emerson Electric Co. has been managing its debt levels relative to its capital structure.
A lower debt-to-capital ratio can indicate a more conservative financial strategy and lower risk, as it means the company relies less on debt financing. On the other hand, a higher ratio may signal higher leverage and financial risk.
Overall, monitoring changes in the debt-to-capital ratio over time can provide insights into Emerson Electric Co.'s capital structure management and financial risk profile.
Peer comparison
Dec 31, 2023