Keurig Dr Pepper Inc (KDP)
Solvency ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.24 | 0.24 | 0.24 | 0.25 | 0.19 | 0.19 | 0.19 | 0.19 | 0.21 | 0.22 | 0.22 | 0.23 | 0.23 | 0.23 | 0.23 | 0.23 | 0.22 | 0.24 | 0.24 | 0.25 |
| Debt-to-capital ratio | 0.35 | 0.33 | 0.33 | 0.34 | 0.28 | 0.28 | 0.28 | 0.28 | 0.31 | 0.32 | 0.31 | 0.31 | 0.32 | 0.32 | 0.33 | 0.33 | 0.32 | 0.33 | 0.34 | 0.35 |
| Debt-to-equity ratio | 0.53 | 0.50 | 0.50 | 0.52 | 0.39 | 0.39 | 0.39 | 0.40 | 0.44 | 0.46 | 0.46 | 0.45 | 0.46 | 0.48 | 0.48 | 0.49 | 0.47 | 0.50 | 0.52 | 0.55 |
| Financial leverage ratio | 2.20 | 2.11 | 2.12 | 2.12 | 2.03 | 2.04 | 2.05 | 2.06 | 2.06 | 2.05 | 2.03 | 2.01 | 2.03 | 2.06 | 2.08 | 2.09 | 2.09 | 2.12 | 2.14 | 2.16 |
The solvency ratios of Keurig Dr Pepper Inc indicate its ability to meet its long-term financial obligations.
1. Debt-to-assets ratio: This ratio shows the proportion of the company's assets financed by debt. Keurig Dr Pepper's debt-to-assets ratio has been consistently low, ranging from 0.19 to 0.25 over the past few years. A lower ratio signifies a lower dependency on debt for asset financing, indicating a stronger financial position.
2. Debt-to-capital ratio: This ratio reflects the proportion of the company's capital structure that is financed by debt. Keurig Dr Pepper's debt-to-capital ratio has also remained relatively stable, ranging from 0.28 to 0.35. The trend indicates a moderate reliance on debt for capital needs, but the company has maintained a balanced approach to capital structure.
3. Debt-to-equity ratio: This ratio compares the company's total debt to its shareholders' equity, showing the extent to which debt is used to finance operations. Keurig Dr Pepper's debt-to-equity ratio has fluctuated between 0.39 and 0.55, reflecting variations in the company's leverage over time. However, the ratio has generally decreased, indicating a decreasing reliance on debt relative to equity.
4. Financial leverage ratio: This ratio indicates the company's financial leverage or the degree to which it uses debt to finance operations. Keurig Dr Pepper's financial leverage ratio has shown a downward trend, ranging from 2.01 to 2.20. A decreasing ratio suggests a lower level of financial risk associated with debt financing.
Overall, Keurig Dr Pepper Inc's consistent performance in maintaining low to moderate solvency ratios demonstrates a prudent approach to managing its long-term financial obligations and capital structure.
Coverage ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 4.59 | 4.37 | 4.99 | 6.79 | 6.44 | 4.21 | 3.49 | 3.21 | 3.76 | 5.26 | 6.07 | 6.40 | 5.79 | 4.73 | 4.68 | 4.40 | 3.29 | 7.87 | 4.89 | 3.65 |
Based on the data provided for Keurig Dr Pepper Inc's interest coverage ratio over multiple periods, the company's ability to cover its interest expense improved significantly from March 31, 2020, to December 31, 2021. The interest coverage ratio increased steadily from 3.65 in March 2020 to 5.79 in December 2021, indicating that the company's operating income was more than sufficient to cover its interest obligations during this period.
However, the interest coverage ratio experienced some fluctuations in the following periods, ranging from a low of 3.21 in March 2023 to a high of 6.79 in June 2024. Despite these variations, the company generally maintained a healthy interest coverage ratio above 3, which is considered a minimum threshold for financial stability.
The slight fluctuations in the interest coverage ratio may suggest some variability in the company's earnings and/or interest expenses during these periods. It is important for investors and stakeholders to monitor these fluctuations to ensure that the company's ability to meet its interest obligations remains strong and consistent over time.