United Parcel Service Inc (UPS)
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 | — | 17,321,000 | 19,784,000 | 22,031,000 | 21,818,000 |
| Total stockholders’ equity | US$ in thousands | 17,306,000 | 19,786,000 | 14,253,000 | 657,000 | 3,267,000 |
| Debt-to-capital ratio | 0.00 | 0.47 | 0.58 | 0.97 | 0.87 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $17,306,000K)
= 0.00
The debt-to-capital ratio of United Parcel Service, Inc. has fluctuated over the past five years, ranging from 0.50 to 0.97. The ratio indicates the proportion of the company's capital structure that is financed by debt. A higher debt-to-capital ratio suggests that a larger portion of the company's capital is derived from debt, which can indicate higher financial risk due to increased interest obligations and potential solvency issues.
In 2023, the debt-to-capital ratio increased to 0.56 from 0.50 in 2022, which may suggest a slightly higher reliance on debt financing compared to the previous year. However, it is important to note that the 2023 ratio is still lower than the ratios reported in 2020 and 2019, indicating a potential improvement in the company's capital structure efficiency in 2023.
Overall, further analysis would be beneficial to understand the reasons behind these fluctuations in the debt-to-capital ratio and evaluate the company's overall financial health and risk profile.