Pentair PLC (PNR)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,988,300 | 2,317,300 | 894,100 | 839,600 | 1,029,100 |
| Total stockholders’ equity | US$ in thousands | 3,217,100 | 2,708,100 | 2,421,900 | 2,106,300 | 1,953,900 |
| Debt-to-capital ratio | 0.38 | 0.46 | 0.27 | 0.29 | 0.34 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,988,300K ÷ ($1,988,300K + $3,217,100K)
= 0.38
The debt-to-capital ratio of Pentair plc has fluctuated over the past five years, indicating changes in the company's capital structure and leverage position. In 2023, the ratio decreased to 0.38 from 0.46 in 2022, suggesting a lower reliance on debt compared to the previous year. This may indicate improved financial health and reduced financial risk.
In 2021, the ratio was relatively low at 0.27, indicating a conservative level of debt relative to capital. However, there was an increase in the ratio in 2022 and 2023, which could imply a shift towards higher debt usage or a decrease in capital.
Comparing the most recent ratio to 2019 and 2020, there has been a notable decrease from 0.34 and 0.29, respectively. This trend may reflect a conscious effort by the company to manage its debt levels and optimize its capital structure.
Overall, the fluctuation in Pentair plc's debt-to-capital ratio over the years demonstrates a dynamic approach to balancing debt and equity in its capital structure, with the recent decrease potentially indicating a more conservative financial strategy.
Peer comparison
Dec 31, 2023