3M Company (MMM)
Debt-to-equity ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 13,088,000 | 14,001,000 | 16,056,000 | 17,989,000 | 17,518,000 |
| Total stockholders’ equity | US$ in thousands | 4,807,000 | 14,722,000 | 15,046,000 | 12,867,000 | 10,063,000 |
| Debt-to-equity ratio | 2.72 | 0.95 | 1.07 | 1.40 | 1.74 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $13,088,000K ÷ $4,807,000K
= 2.72
The debt-to-equity ratio of 3M Co. has fluctuated over the past five years. The ratio was 3.35 at the end of 2023, indicating a significant increase from the prior year. This high ratio suggests that the company has a higher level of debt relative to its equity, which may raise concerns about its financial leverage and ability to meet financial obligations.
In contrast, the ratio was 1.09 at the end of 2022, which was a significant improvement from the previous year. This lower ratio indicates a stronger equity position relative to debt, suggesting a more conservative financial structure.
In 2021, the debt-to-equity ratio was 1.16, showing a slight increase from the prior year but still within a reasonable range. The ratio of 1.47 at the end of 2020 was higher, indicating increased reliance on debt financing compared to equity.
The highest debt-to-equity ratio in the period was recorded at 2.03 at the end of 2019, signaling a relatively high level of debt compared to equity, which could potentially pose risks for the company's financial stability.
Overall, the trend in 3M Co.'s debt-to-equity ratio suggests fluctuations in the company's capital structure over the past five years, with the ratio reaching both high and low points. Investors and analysts may need to closely monitor this ratio to assess the company's financial risk and leverage levels.
Peer comparison
Dec 31, 2023