The Coca-Cola Company (KO)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 4.05 | 3.77 | 3.85 | 4.10 | 4.52 |
The solvency ratios of The Coca-Cola Company indicate a consistently strong financial position over the years. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio have all been reported as 0.00 from December 31, 2020, to December 31, 2024. This suggests that the company has minimal debt relative to its assets, capital, and equity, reflecting a low level of financial risk.
The financial leverage ratio, which measures the extent to which a company utilizes debt in its capital structure, has shown some variation during the same period. The ratio decreased from 4.52 in 2020 to 3.77 in 2023 before slightly increasing to 4.05 in 2024. Even though there was a slight uptick in 2024, the financial leverage ratio remains relatively stable across the years, indicating that the company has effectively managed its leverage and maintained a healthy balance between debt and equity financing.
Overall, based on these solvency ratios, The Coca-Cola Company appears to be in a strong financial position with a prudent approach to managing its debt levels and leverage, which bodes well for its long-term financial stability and sustainability.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 8.90 | 9.49 | 14.23 | 8.19 | 7.74 |
The interest coverage ratio for The Coca-Cola Company has shown a generally positive trend over the years, indicating the company's ability to meet its interest obligations from its earnings.
As of December 31, 2020, the interest coverage ratio stood at 7.74, suggesting that the company's operating income was sufficient to cover its interest expenses approximately 7.74 times over. This level improved to 8.19 by December 31, 2021, indicating a slight increase in the company's ability to cover interest expenses.
The most significant improvement was seen by December 31, 2022, where the interest coverage ratio jumped to 14.23, signaling a substantial increase in the company's ability to meet its interest obligations comfortably. However, by December 31, 2023, the ratio decreased to 9.49, indicating a slight decline in the company's ability to cover interest expenses compared to the previous year.
By December 31, 2024, the interest coverage ratio was 8.90, which, although lower compared to 2022, still indicates a healthy ability to cover interest expenses. Overall, The Coca-Cola Company has demonstrated a strong capacity to service its debt obligations from its operating income, with fluctuations reflecting changes in the business environment and financial performance.