Walgreens Boots Alliance Inc (WBA)
Solvency ratios
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.08 | 0.12 | 0.09 | 0.14 | 0.16 |
| Debt-to-capital ratio | 0.29 | 0.30 | 0.25 | 0.37 | 0.32 |
| Debt-to-equity ratio | 0.41 | 0.42 | 0.33 | 0.59 | 0.47 |
| Financial leverage ratio | 4.83 | 3.57 | 3.47 | 4.22 | 2.88 |
The solvency ratios of Walgreens Boots Alliance Inc indicate the company's ability to meet its long-term financial obligations and the extent to which it relies on debt financing.
The debt-to-assets ratio has shown a decreasing trend over the past five years, declining from 0.25 in 2019 to 0.09 in 2023. This suggests that the company has reduced its reliance on debt to finance its assets, which is a positive sign for solvency.
Similarly, the debt-to-capital ratio has also exhibited a decreasing trend, indicating a decline in the proportion of capital funded by debt. This trend reflects a more conservative capital structure and potentially lower financial risk.
Furthermore, the debt-to-equity ratio has shown a decreasing trend as well, indicating a diminishing reliance on debt in relation to equity. A decreasing trend in this ratio suggests a reduced financial risk and enhanced solvency.
The financial leverage ratio, which measures the extent to which the company relies on debt in its capital structure, also reflects an improving solvency position. The increase in this ratio over the years indicates a higher reliance on debt, but the overall trend is positive given the decreasing debt-to-assets and debt-to-equity ratios.
In conclusion, Walgreens Boots Alliance Inc's solvency ratios paint a favorable picture, indicating a declining reliance on debt and an overall improvement in the company's ability to meet its long-term financial obligations.
Coverage ratios
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | -7.51 | 11.77 | 4.55 | 2.30 | 8.01 |
The interest coverage ratio for Walgreens Boots Alliance Inc has exhibited significant fluctuations over the past five years. In 2019, the interest coverage ratio was 7.13, indicating that the company's operating income was more than sufficient to cover its interest expenses. However, this ratio deteriorated in subsequent years, reaching 2.12 in 2020 and further declining to 3.28 in 2021. The most recent data reveals a concerning decrease, with the interest coverage ratio plummeting to -11.81 in 2023, indicating that the company's operating income was insufficient to cover its interest expenses. Such a negative interest coverage ratio raises concerns about the company's ability to meet its interest obligations from its operating income. It is imperative for stakeholders to closely monitor the company's financial performance and management of its interest expenses to ensure financial stability and solvency.