Zoetis Inc (ZTS)
Solvency ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.37 | 0.46 | 0.46 | 0.46 | 0.46 | 0.46 | 0.48 | 0.48 | 0.44 | 0.38 | 0.38 | 0.38 | 0.47 | 0.48 | 0.47 | 0.48 | 0.48 | 0.48 | 0.55 | 0.52 |
| Debt-to-capital ratio | 0.52 | 0.56 | 0.57 | 0.56 | 0.57 | 0.56 | 0.59 | 0.59 | 0.60 | 0.53 | 0.53 | 0.53 | 0.59 | 0.58 | 0.60 | 0.62 | 0.64 | 0.65 | 0.71 | 0.68 |
| Debt-to-equity ratio | 1.09 | 1.26 | 1.32 | 1.30 | 1.31 | 1.29 | 1.42 | 1.46 | 1.49 | 1.12 | 1.14 | 1.12 | 1.45 | 1.41 | 1.52 | 1.61 | 1.75 | 1.83 | 2.41 | 2.17 |
| Financial leverage ratio | 2.98 | 2.74 | 2.85 | 2.84 | 2.86 | 2.78 | 2.97 | 3.06 | 3.39 | 2.93 | 3.01 | 2.98 | 3.06 | 2.93 | 3.23 | 3.37 | 3.61 | 3.81 | 4.38 | 4.19 |
Zoetis Inc's solvency ratios indicate the company's ability to meet its long-term debt obligations.
The Debt-to-assets ratio decreased steadily from 0.52 in March 2020 to 0.37 in December 2024, suggesting a positive trend in the company's ability to cover its assets with debt.
The Debt-to-capital ratio also showed a decreasing trend, from 0.68 in March 2020 to 0.52 in December 2024. This indicates that Zoetis Inc relied less on debt financing relative to its total capital over the period.
Similarly, the Debt-to-equity ratio decreased consistently from 2.17 in March 2020 to 1.09 in December 2024, implying a reduction in the company's reliance on debt compared to equity for financing its operations.
The Financial leverage ratio declined gradually from 4.19 in March 2020 to 2.98 in December 2024, reflecting a decreasing level of financial risk and leverage in the company's capital structure.
Overall, the declining trends in these solvency ratios illustrate Zoetis Inc's improving financial stability and lower reliance on debt for its long-term operations.
Coverage ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 14.88 | 14.06 | 13.32 | 13.77 | 13.30 | 12.90 | 13.00 | 12.38 | 13.03 | 13.08 | 12.87 | 12.50 | 12.12 | 11.55 | 11.01 | 10.31 | 9.65 | 9.79 | 9.72 | 9.71 |
Interest coverage ratio is a financial metric used to assess a company's ability to meet its interest obligations on outstanding debt. Zoetis Inc's interest coverage ratio has shown a generally positive trend over the reported periods, starting at 9.71 as of March 31, 2020, and increasing to 14.88 as of December 31, 2024.
The interest coverage ratio provides insight into Zoetis Inc's ability to pay interest expenses on its debt using its operating income. A ratio above 1 indicates the company is generating enough operating income to cover its interest payments. Zoetis Inc's consistent interest coverage ratio above 1 signifies that the company has been able to comfortably meet its interest obligations with its operating profits.
The improvement in Zoetis Inc's interest coverage ratio over the years indicates strengthened financial stability and reduced risk of default on its debt obligations. Investors and creditors typically view a higher interest coverage ratio favorably as it indicates the company's ability to manage its debt effectively.