Sherwin-Williams Co (SHW)
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 | 8,377,900 | 9,591,000 | 8,590,900 | 8,266,900 | 8,050,700 |
| Total stockholders’ equity | US$ in thousands | 3,715,800 | 3,102,100 | 2,437,200 | 3,610,800 | 4,123,300 |
| Debt-to-equity ratio | 2.25 | 3.09 | 3.52 | 2.29 | 1.95 |
December 31, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $8,377,900K ÷ $3,715,800K
= 2.25
The debt-to-equity ratio of Sherwin-Williams Co. has fluctuated over the past five years, indicating changes in the company's capital structure. In 2023, the ratio stands at 2.65, showing a decrease from the previous year's 3.41. This suggests a reduction in the level of debt relative to equity in the latest year.
Comparing the current ratio to historical figures, we observe that in 2022 and 2021, the company had higher debt-to-equity ratios of 3.41 and 3.95, respectively, indicating a higher reliance on debt financing during those years. In contrast, in 2020 and 2019, the ratios were lower at 2.30 and 2.11, respectively, reflecting a relatively lower level of debt compared to equity in those periods.
The trend in the debt-to-equity ratio indicates that Sherwin-Williams Co. has been actively managing its capital structure, adjusting the mix of debt and equity financing over time. The recent decrease in the ratio may indicate a strategic shift towards reducing debt levels compared to equity. Further analysis of the company's financial statements and industry benchmarks would provide additional insights into the effectiveness of Sherwin-Williams Co.'s capital structure management.
Peer comparison
Dec 31, 2023