McCormick & Company Incorporated (MKC)

Solvency ratios

Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020 May 31, 2020 Feb 29, 2020 Nov 30, 2019 Aug 31, 2019 May 31, 2019
Debt-to-assets ratio 0.26 0.26 0.26 0.32 0.27 0.28 0.30 0.30 0.31 0.31 0.31 0.37 0.37 0.31 0.34 0.39 0.35 0.35 0.37 0.39
Debt-to-capital ratio 0.39 0.40 0.40 0.45 0.43 0.44 0.46 0.46 0.46 0.47 0.48 0.52 0.53 0.49 0.49 0.53 0.50 0.51 0.53 0.54
Debt-to-equity ratio 0.64 0.66 0.67 0.83 0.74 0.78 0.85 0.85 0.86 0.90 0.91 1.09 1.14 0.96 0.95 1.13 1.02 1.05 1.11 1.18
Financial leverage ratio 2.46 2.54 2.57 2.61 2.71 2.80 2.82 2.82 2.81 2.93 2.94 2.96 3.06 3.08 2.76 2.90 2.95 3.01 2.99 3.04

McCormick & Company Incorporated's solvency ratios show a relatively stable trend over the past two years. The debt-to-assets ratio has hovered around 0.26 to 0.39, indicating that the company finances about 26% to 39% of its assets through debt. This indicates a moderate level of financial risk.

The debt-to-capital ratio has also remained relatively consistent, ranging from 0.39 to 0.54, showing that the company finances around 39% to 54% of its capital structure with debt. This suggests a moderate level of leverage in the company's capital structure.

The debt-to-equity ratio has shown a similar stable trend, fluctuating between 0.64 to 1.18, indicating that the company's debt levels compared to equity have been within the range of 64% to 118%. This suggests that McCormick & Company Incorporated relies moderately on debt financing compared to equity.

The financial leverage ratio, which measures the company's reliance on debt to finance its assets, has remained around 2.46 to 3.08. This implies that the company has been using debt as a significant component of its capital structure, with a range of 2.46 to 3.08 times the equity financing.

Overall, McCormick & Company Incorporated's solvency ratios indicate a stable and moderate level of leverage and debt utilization in its capital structure, which suggests a balanced approach to financing its operations and investments.

Coverage ratios

Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020 May 31, 2020 Feb 29, 2020 Nov 30, 2019 Aug 31, 2019 May 31, 2019
Interest coverage 5.32 5.11 5.09 5.79 6.01 6.70 7.28 7.18 7.75 7.94 8.01 8.10 8.22 7.80 7.66 7.15 6.49 6.21 5.98 5.71

Interest coverage measures a company's ability to meet its interest obligations with its operating income. The interest coverage ratio for McCormick & Company Incorporated has been relatively stable and consistently above 5 over the past several quarters, indicating that the company has ample earnings to cover its interest expenses.

The trend shows a slight decrease in the interest coverage ratio in recent periods, dropping from 8.22 in February 2021 to 5.32 in February 2024. While this downtrend may suggest a potential increase in the company's financial risk or a decline in profitability relative to its interest expenses, it is still important to note that the company's interest coverage remains at a healthy level.

Overall, an interest coverage ratio above 5 is generally considered acceptable, indicating McCormick & Company's ability to comfortably meet its interest payments. However, stakeholders should continue to monitor changes in the ratio to assess the company's financial health and ability to service its debt obligations effectively.