PepsiCo Inc (PEP)

Debt-to-assets ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	37,595,000	35,657,000	36,026,000	40,370,000	29,148,000
Total assets	US$ in thousands	100,495,000	92,187,000	92,377,000	92,918,000	78,547,000
Debt-to-assets ratio		0.37	0.39	0.39	0.43	0.37

December 31, 2023 calculation

Debt-to-assets ratio = Long-term debt ÷ Total assets
= $37,595,000K ÷ $100,495,000K
= 0.37

The debt-to-assets ratio of PepsiCo Inc has been relatively stable over the past five years, fluctuating between 0.37 and 0.43. This ratio indicates that, on average, PepsiCo Inc finances approximately 37% to 43% of its total assets through debt, with the rest being funded by equity.

A decreasing trend in the debt-to-assets ratio from 0.43 in 2020 to 0.37 in 2019 suggests that PepsiCo has reduced its reliance on debt financing over the years, which can be seen as a positive indicator of lower financial risk. However, the ratio increased again in 2022 to 0.39, showing a slight uptick in debt usage.

Overall, a debt-to-assets ratio below 0.5 is generally considered healthy, indicating a stable financial position where the company's assets are well backed by equity and not overly burdened by debt obligations. PepsiCo's consistent ratio within this range demonstrates a balanced capital structure and the ability to efficiently manage its debt levels over the years.