Hormel Foods Corporation (HRL)
Debt-to-capital ratio
| Oct 27, 2024 | Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Oct 25, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 2,850,940 | 2,358,720 | 3,290,550 | 3,315,150 | 1,044,940 |
| Total stockholders’ equity | US$ in thousands | 7,993,420 | 7,734,880 | 7,535,280 | 6,972,880 | 6,425,550 |
| Debt-to-capital ratio | 0.26 | 0.23 | 0.30 | 0.32 | 0.14 |
October 27, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $2,850,940K ÷ ($2,850,940K + $7,993,420K)
= 0.26
The debt-to-capital ratio of Hormel Foods Corporation has exhibited some fluctuations over the past five years. In fiscal year 2020, the ratio was at its lowest at 0.14, indicating a relatively lower level of debt compared to capital. Subsequently, the ratio increased to 0.32 in fiscal year 2021, reflecting a higher proportion of debt in the company's capital structure.
In fiscal year 2022, there was a slight decrease in the debt-to-capital ratio to 0.30, suggesting a move towards a more balanced debt and equity mix. This trend continued into fiscal year 2023, with the ratio further decreasing to 0.23, indicating a potentially improved financial position with a lower reliance on debt for financing.
Most recently, in fiscal year 2024, the debt-to-capital ratio increased to 0.26. Although higher than the previous year, it is still lower than the ratios observed in fiscal years 2021 and 2022. This suggests that Hormel Foods Corporation continues to maintain a moderate level of debt relative to its capital base.
Overall, the fluctuations in the debt-to-capital ratio of Hormel Foods Corporation over the past five years indicate varying degrees of leverage in the company's capital structure. It is essential for stakeholders to monitor this ratio to assess the company's financial risk and leverage levels.