Laboratory Corporation of America Holdings (LH)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 4,054,700 | 5,038,800 | 5,416,500 | 5,419,000 | 5,789,800 |
| Total stockholders’ equity | US$ in thousands | 7,875,000 | 10,096,600 | 10,273,400 | 9,436,600 | 7,643,900 |
| Debt-to-capital ratio | 0.34 | 0.33 | 0.35 | 0.36 | 0.43 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $4,054,700K ÷ ($4,054,700K + $7,875,000K)
= 0.34
The debt-to-capital ratio of Laboratory Corp. Of America Holdings has fluctuated over the past five years, as indicated in the table. The ratio represents the proportion of the company's capital structure financed by debt.
The trend shows a decrease in the debt-to-capital ratio from 0.45 in 2019 to 0.39 in 2023, with fluctuations in between. A lower ratio often indicates a lower level of financial risk as the company relies less on debt financing compared to its equity.
It is worth noting that the ratio has remained relatively stable between 0.35 and 0.39 from 2020 to 2023, suggesting a consistent balance between debt and equity in the company's capital structure. This may indicate a prudent approach to managing its financial obligations and maintaining a healthy capital mix.
Overall, the debt-to-capital ratio trend indicates that Laboratory Corp. Of America Holdings has been managing its debt levels effectively over the years, potentially enhancing its financial stability and creditworthiness.
Peer comparison
Dec 31, 2023