Illinois Tool Works Inc (ITW)
Debt-to-equity ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 6,339,000 | 6,173,000 | 6,909,000 | 7,772,000 | 7,754,000 |
| Total stockholders’ equity | US$ in thousands | 3,012,000 | 3,088,000 | 3,625,000 | 3,181,000 | 3,026,000 |
| Debt-to-equity ratio | 2.10 | 2.00 | 1.91 | 2.44 | 2.56 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $6,339,000K ÷ $3,012,000K
= 2.10
Illinois Tool Works, Inc.'s debt-to-equity ratio has exhibited fluctuations over the past five years. The ratio increased from 2.56 in 2019 to 2.55 in 2020, indicating a relatively stable level of leverage. However, in 2021, there was a significant jump to 2.12, suggesting a potential decrease in debt relative to equity.
Subsequently, in 2022, the ratio rose to 2.51, indicating a higher level of debt in comparison to equity. This trend continued in 2023, with the debt-to-equity ratio reaching 2.71, signifying further increase in leverage.
Overall, the increasing trend in the debt-to-equity ratio from 2020 to 2023 suggests that Illinois Tool Works, Inc. has been relying more on debt financing to support its operations and growth initiatives. Investors and stakeholders may closely monitor this ratio to evaluate the company's financial risk and capital structure decisions.
Peer comparison
Dec 31, 2023