Walgreens Boots Alliance Inc (WBA)
Debt-to-capital ratio
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 8,044,000 | 8,145,000 | 10,615,000 | 7,675,000 | 12,203,000 |
| Total stockholders’ equity | US$ in thousands | 10,445,000 | 20,020,000 | 25,275,000 | 23,419,000 | 20,637,000 |
| Debt-to-capital ratio | 0.44 | 0.29 | 0.30 | 0.25 | 0.37 |
August 31, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $8,044,000K ÷ ($8,044,000K + $10,445,000K)
= 0.44
The debt-to-capital ratio of Walgreens Boots Alliance Inc has exhibited fluctuations over the past five years. As of August 31, 2024, the ratio stands at 0.44, indicating that 44% of the company's capital structure is financed by debt. This represents an increase from the previous year when the ratio was 0.29.
The upward trend in the debt-to-capital ratio suggests that the company has been relying more on debt financing compared to its equity over the years. This could indicate a higher level of financial leverage, which may pose risks in terms of debt repayment obligations and interest expenses.
It is worth noting that the ratio was highest in 2020 at 0.37, then decreased in 2021 and 2022, only to rise again in the most recent year. This fluctuation may signify changes in the company's capital structure and financing decisions.
Overall, the increasing trend in the debt-to-capital ratio for Walgreens Boots Alliance Inc raises concerns about the company's debt management and financial stability. Further analysis of the company's debt levels, interest coverage, and debt repayment capabilities is recommended to assess the impact of the debt on its overall financial health.
Peer comparison
Aug 31, 2024