Lithia Motors Inc (LAD)
Debt-to-capital ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | — | — | — | 2,545,200 | 1,964,800 |
| Total stockholders’ equity | US$ in thousands | 6,655,500 | 6,213,900 | 5,206,200 | 4,626,400 | 2,661,500 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.35 | 0.42 |
December 31, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $6,655,500K)
= 0.00
The debt-to-capital ratio of Lithia Motors Inc has shown a decreasing trend over the years. As of December 31, 2020, the ratio was 0.42, indicating that 42% of the company's capital was financed by debt. By December 31, 2021, the ratio decreased to 0.35, showing improved capital structure with lower reliance on debt.
Notably, from December 31, 2022 to December 31, 2024, the debt-to-capital ratio plummeted to 0.00, suggesting that the company has eliminated its debt and is now entirely reliant on equity for funding its operations. This reduction in debt indicates a stronger financial position and lower financial risk for Lithia Motors Inc.
Overall, the trend in the debt-to-capital ratio reflects a positive development in the company's financial structure, with decreasing debt levels and a move towards a more sustainable and stable capital base.
Peer comparison
Dec 31, 2024