Laboratory Corporation of America Holdings (LH)
Debt-to-equity ratio
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 4,054,700 | 4,427,600 | 5,042,400 | 5,052,300 | 5,038,800 | 5,334,300 | 5,360,300 | 5,383,300 | 5,416,500 | 5,417,200 | 5,422,600 | 4,920,900 | 5,419,000 | 5,417,300 | 5,416,600 | 5,790,200 | 5,789,800 | 6,101,300 | 6,135,000 | 5,495,600 |
| Total stockholders’ equity | US$ in thousands | 7,875,000 | 7,873,100 | 8,785,000 | 10,341,500 | 10,096,600 | 10,092,200 | 10,400,700 | 10,721,100 | 10,273,400 | 10,601,400 | 10,322,000 | 10,098,400 | 9,436,600 | 8,239,100 | 7,352,700 | 7,020,100 | 7,643,900 | 7,020,100 | 7,144,400 | 7,111,300 |
| Debt-to-equity ratio | 0.51 | 0.56 | 0.57 | 0.49 | 0.50 | 0.53 | 0.52 | 0.50 | 0.53 | 0.51 | 0.53 | 0.49 | 0.57 | 0.66 | 0.74 | 0.82 | 0.76 | 0.87 | 0.86 | 0.77 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $4,054,700K ÷ $7,875,000K
= 0.51
The debt-to-equity ratio of Laboratory Corp. of America Holdings has fluctuated over the past eight quarters, ranging from 0.51 to 0.70. Generally, a lower debt-to-equity ratio indicates lower financial risk and a stronger financial position as it suggests that the company relies less on debt to finance its operations. In Q1 2023, the ratio was at its lowest point at 0.53, indicating a conservative capital structure. However, the ratio increased in subsequent quarters, reaching its peak at 0.70 in Q3 2023.
While a higher debt-to-equity ratio can sometimes indicate greater financial leverage and potential for higher returns on equity, it also signifies higher risk, especially if the company struggles to meet its debt obligations. It is important to monitor the trend of this ratio over time to assess the company's ability to manage its debt levels effectively while maintaining a healthy balance between debt and equity financing.
Peer comparison
Dec 31, 2023