Zoetis Inc (ZTS)
Solvency ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 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 | 0.52 | 0.57 | 0.59 | 0.59 |
| Debt-to-capital ratio | 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 | 0.69 | 0.71 | 0.73 | 0.74 |
| Debt-to-equity ratio | 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 | 2.20 | 2.41 | 2.67 | 2.78 |
| Financial leverage ratio | 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 | 4.26 | 4.21 | 4.56 | 4.70 |
The solvency ratios of Zoetis Inc indicate the company's ability to meet its long-term financial obligations. Starting with the debt-to-assets ratio, we observe a fluctuation over the quarters, staying within the range of 0.46 to 0.53. This ratio suggests that Zoetis finances a portion of its assets through debt, with a lower ratio indicating lower reliance on debt for asset financing.
Moving on to the debt-to-capital ratio, we see a similar trend of fluctuation between 0.56 and 0.64. This ratio reflects the proportion of the company's capital that is financed through debt and shows a slightly higher variability compared to the debt-to-assets ratio.
The debt-to-equity ratio for Zoetis demonstrates a more significant variability, ranging from 1.29 to 1.79. This ratio indicates the degree to which the company is leveraged through debt in relation to shareholders' equity. A higher ratio suggests higher financial risk due to increased reliance on debt financing.
Lastly, the financial leverage ratio, which combines debt and equity to measure the company's overall financial health, shows fluctuations between 2.78 and 3.39. A higher ratio implies a greater reliance on debt funding, potentially increasing financial risk if the company faces challenges in meeting its debt obligations.
In conclusion, Zoetis' solvency ratios reflect its ongoing management of debt levels and capital structure. The fluctuations in these ratios over the quarters indicate changes in the company's financing strategies and its ability to navigate varying market conditions. Investors and stakeholders may closely monitor these ratios to assess Zoetis' long-term financial stability and risk exposure.
Coverage ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 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 | 9.08 | 8.88 | 8.46 | 8.70 |
Based on the provided data, the interest coverage ratio of Zoetis Inc has been consistently increasing over the past eight quarters. The interest coverage ratio measures the company's ability to meet its interest obligations on outstanding debt using its operating income.
The trend indicates that Zoetis Inc's ability to cover its interest payments has been improving steadily, which is a positive sign for investors and creditors. The significant increase from 13.37 in Q1 2022 to 23.18 in Q4 2023 indicates a notable improvement in the company's financial health and ability to service its debt.
A higher interest coverage ratio suggests that the company is generating more than enough operating income to cover its interest expenses. This could indicate a strong financial position, lower default risk, and greater financial stability for Zoetis Inc. Overall, the consistent improvement in the interest coverage ratio reflects positively on the company's financial performance and management of debt obligations.