Perrigo Company PLC (PRGO)

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	3,632,800	4,070,400	2,916,700	3,527,600	3,365,800
Total stockholders’ equity	US$ in thousands	4,767,900	4,842,100	5,151,700	5,655,100	5,803,800
Debt-to-equity ratio		0.76	0.84	0.57	0.62	0.58

December 31, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $3,632,800K ÷ $4,767,900K
= 0.76

The debt-to-equity ratio of Perrigo Company plc has shown a gradual increasing trend over the past five years, from 0.58 in 2019 to 0.85 in both 2022 and 2023. This indicates that the company has been relying more on debt financing relative to equity financing during this period.

A higher debt-to-equity ratio suggests that the company is more leveraged and has a higher proportion of debt in its capital structure compared to equity. While this can amplify returns on equity when the company is performing well, it also increases financial risk as debt obligations need to be serviced even in challenging economic conditions.

It is important for investors and stakeholders to monitor Perrigo's debt levels and its ability to manage and service this debt effectively. A sustained increase in the debt-to-equity ratio may signal potential financial distress or constraints on the company's financial flexibility in the future.