Marriott International Inc (MAR)
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 | 0.50 | 0.48 | 0.47 | 0.45 | 0.44 | 0.43 | 0.41 | 0.41 | 0.37 | 0.35 | 0.32 | 0.31 | 0.32 | 0.34 | 0.36 | 0.36 | 0.33 | 0.34 | 0.30 | 0.23 |
| Debt-to-capital ratio | 1.30 | 1.24 | 1.21 | 1.16 | 1.06 | 1.07 | 1.02 | 0.99 | 0.94 | 0.89 | 0.81 | 0.81 | 0.85 | 0.90 | 0.92 | 0.97 | 0.95 | 0.97 | 1.01 | 1.00 |
| Debt-to-equity ratio | — | — | — | — | — | — | — | 72.64 | 16.28 | 8.21 | 4.40 | 4.40 | 5.76 | 9.12 | 11.10 | 37.79 | 18.97 | 37.56 | — | — |
| Financial leverage ratio | — | — | — | — | — | — | — | 177.59 | 43.69 | 23.30 | 13.89 | 14.24 | 18.07 | 26.69 | 30.78 | 104.14 | 57.44 | 109.82 | — | — |
The solvency ratios of Marriott International Inc provide insight into its ability to meet its long-term financial obligations.
1. Debt-to-assets ratio: This ratio measures the proportion of the company’s assets financed by debt. Marriott's debt-to-assets ratio has been gradually increasing from 0.23 in March 2020 to 0.50 in December 2024. This indicates that the company's level of debt compared to its total assets is increasing over time.
2. Debt-to-capital ratio: This ratio shows the percentage of the company's capital that is financed by debt. Marriott's debt-to-capital ratio fluctuated throughout the years, starting at 1.00 in March 2020, dropping to 0.81 in March 2022, and then increasing significantly to 1.30 by December 2024. The increasing trend implies that a larger portion of Marriott's capital is being funded by debt.
3. Debt-to-equity ratio: This ratio compares the company's total debt to its total equity, indicating the extent to which the company is leveraging its equity. Marriott's debt-to-equity ratio varied widely, from 37.56 in September 2020 to 4.40 in June 2022, before data becomes unavailable after March 2023. The decreasing trend in this ratio suggests that Marriott was reducing its reliance on debt to finance its operations.
4. Financial leverage ratio: This ratio measures the company's financial risk by comparing its total assets to its equity. Marriott's financial leverage ratio also showed fluctuation, with a peak of 177.59 in March 2023 before data is no longer available. A high financial leverage ratio indicates higher financial risk due to a larger proportion of debt in the company's capital structure.
Overall, the trend in Marriott International Inc's solvency ratios suggests a mixed picture of increasing debt levels relative to assets and capital, alongside varying levels of financial risk and reliance on debt financing. It's important for investors and analysts to monitor these ratios to understand the company's financial health and risk profile.
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 | 5.44 | 5.63 | 6.23 | 6.42 | 6.98 | 8.00 | 8.42 | 8.99 | 8.73 | 8.20 | 6.56 | 5.15 | 3.81 | 1.73 | 1.38 | -0.12 | -0.05 | 1.41 | 2.38 | 4.04 |
Interest coverage is a financial ratio that measures a company's ability to pay interest expenses on its outstanding debt. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expenses.
Analyzing the interest coverage ratio of Marriott International Inc over the past few years, we observe fluctuations in the ratio. As of December 31, 2020, and March 31, 2021, the interest coverage ratio fell below 0, indicating that the company's earnings were insufficient to cover its interest expenses during those periods. This raises concerns about the company's financial health and ability to meet its debt obligations.
However, from June 30, 2021, onwards, the interest coverage ratio showed a significant improvement, climbing steadily to reach a value of 6.23 as of June 30, 2024. This upward trend indicates a strengthened ability to cover interest payments with operating income, reflecting improved financial performance and potentially reduced financial risk for investors and creditors.
Overall, the increasing trend in Marriott's interest coverage ratio from 2021 to 2024 suggests a positive trajectory in the company's financial strength and capacity to meet its interest obligations, which may enhance investor confidence in its ability to manage debt effectively.