Sonoco Products Company (SON)
Debt-to-capital ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 3,035,870 | 3,212,450 | 2,716,250 | 2,717,890 | 2,719,780 | 2,723,100 | 2,727,920 | 2,730,150 | 1,199,110 | 1,192,710 | 1,194,060 | 1,251,510 | 1,244,440 | 1,627,040 | 1,618,640 | 1,187,900 | 1,193,140 | 1,180,220 | 1,188,030 | 1,189,420 |
| Total stockholders’ equity | US$ in thousands | 2,424,340 | 2,332,540 | 2,292,350 | 2,198,400 | 2,065,810 | 1,928,610 | 1,929,680 | 1,911,790 | 1,837,440 | 1,849,990 | 1,811,440 | 1,902,400 | 1,899,600 | 1,871,140 | 1,797,340 | 1,744,260 | 1,802,680 | 1,841,680 | 1,840,360 | 1,788,180 |
| Debt-to-capital ratio | 0.56 | 0.58 | 0.54 | 0.55 | 0.57 | 0.59 | 0.59 | 0.59 | 0.39 | 0.39 | 0.40 | 0.40 | 0.40 | 0.47 | 0.47 | 0.41 | 0.40 | 0.39 | 0.39 | 0.40 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $3,035,870K ÷ ($3,035,870K + $2,424,340K)
= 0.56
The debt-to-capital ratio of Sonoco Products Co. has shown a downward trend over the past eight quarters, decreasing from 0.62 in Q1 2022 to 0.56 in Q4 2023. This indicates that the company has been able to reduce its reliance on debt to finance its operations and investments, relative to its total capital. However, it is essential to note that the ratio has fluctuated within a narrow range of 0.56 to 0.62 during this period, indicating a relatively stable capital structure.
A debt-to-capital ratio of 0.56 in Q4 2023 implies that approximately 56% of the company's capital structure is financed through debt, while the remaining 44% is funded by equity. This suggests that Sonoco Products Co. has a moderate level of leverage, balancing the benefits of debt financing with the associated risks.
Overall, the decreasing trend in the debt-to-capital ratio reflects positively on the company's ability to manage its debt levels effectively. However, it would be beneficial for stakeholders to monitor future changes in the ratio to ensure financial stability and sustainability in the long run.
Peer comparison
Dec 31, 2023