Starbucks Corporation (SBUX)
Solvency ratios
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.46 | 0.47 | 0.43 | 0.50 | 0.58 |
| Debt-to-capital ratio | 2.44 | 2.97 | 1.64 | 2.14 | 2.26 |
| Debt-to-equity ratio | — | — | — | — | — |
| Financial leverage ratio | — | — | — | — | — |
The debt-to-assets ratio for Starbucks Corporation has been relatively stable over the past five years, ranging from 0.43 to 0.58. This ratio indicates that, on average, about 46% to 58% of the company's assets are financed by debt.
The debt-to-capital ratio, on the other hand, has shown more variability, ranging from 1.64 to 2.97. This ratio measures the proportion of a company's capital that is contributed by debt, and the higher values observed suggest a higher reliance on debt financing compared to equity.
Unfortunately, there is no data available for the debt-to-equity ratio or the financial leverage ratio. These ratios could have provided further insights into the company's leverage and solvency positions, especially in assessing the extent to which debt is used to finance operations relative to shareholders' equity.
Overall, based on the available data, it appears that Starbucks Corporation has maintained a moderate level of debt relative to its assets and capital, which indicates a reasonable level of solvency and financial stability. However, a more complete analysis would require additional information to evaluate the company's overall leverage and risk profile accurately.
Coverage ratios
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 10.82 | 9.76 | 12.40 | 3.67 | 14.51 |
Starbucks Corporation's interest coverage ratio has varied over the past five years. The interest coverage ratio measures the company's ability to cover its interest expense with its earnings before interest and taxes (EBIT). A higher ratio indicates that the company is more capable of meeting its interest obligations.
In FY2023, Starbucks' interest coverage ratio was 10.82, reflecting an improvement from the previous year's ratio of 9.76 in FY2022. This suggests that the company's earnings were sufficient to cover its interest expenses with a comfortable margin.
Looking further back, in FY2021, Starbucks had an interest coverage ratio of 12.40, indicating a strong ability to fulfill interest payments. However, the ratio dipped to 3.67 in FY2020, which could be a cause for concern as it suggests a lower capacity to handle interest obligations.
The highest interest coverage ratio over the five-year period was 14.51 in FY2019, indicating a robust financial position where Starbucks had ample earnings to cover interest costs.
Overall, Starbucks Corporation's interest coverage has shown fluctuations, with some years demonstrating stronger financial health than others. Monitoring this ratio is crucial for investors and lenders to assess the company's ability to manage its debt and interest payments effectively.