Lowe's Cos. Inc. (LOW) | Debt and Solvency

Ratios (Summary)

Lowe's Cos. Inc., debt and solvency ratios

	Feb 1, 2013	Feb 3, 2012	Jan 28, 2011	Jan 29, 2010	Jan 30, 2009	Feb 1, 2008
Debt to equity	0.66	0.46	0.36	0.27	0.34	0.41
Debt to capital	0.40	0.32	0.27	0.21	0.25	0.29
Interest coverage	8.26	8.59	10.38	10.29	11.96	19.87

Source: Based on data from Lowe's Cos. Inc. Annual Reports

Ratio	Description	The company
Debt-to-equity ratio	A solvency ratio calculated as total debt divided by total shareholders' equity.	Lowe's Cos. Inc.'s debt-to-equity ratio deteriorated from 2011 to 2012 and from 2012 to 2013.
Debt-to-capital ratio	A solvency ratio calculated as total debt divided by total debt plus shareholders' equity.	Lowe's Cos. Inc.'s debt-to-capital ratio deteriorated from 2011 to 2012 and from 2012 to 2013.
Interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments.	Lowe's Cos. Inc.'s interest coverage ratio deteriorated from 2011 to 2012 and from 2012 to 2013.

	Feb 1, 2013	Feb 3, 2012	Jan 28, 2011	Jan 29, 2010	Jan 30, 2009	Feb 1, 2008
Selected Financial Data (USD $ in millions)
Short-term borrowings	–	–	–	–	987	1,064
Current maturities of long-term debt	47	592	36	552	34	40
Long-term debt, excluding current maturities	9,030	7,035	6,537	4,528	5,039	5,576
Total debt	9,077	7,627	6,573	5,080	6,060	6,680
Shareholders' equity	13,857	16,533	18,112	19,069	18,055	16,098
Debt to Equity, Comparison to Industry
Lowe's Cos. Inc.¹	0.66	0.46	0.36	0.27	0.34	0.41
Industry, Consumer Services	–	0.59	0.56	0.49	0.54	0.66

Source: Based on data from Lowe's Cos. Inc. Annual Reports

2013 Calculations

¹ Debt to equity = Total debt ÷ Shareholders' equity
= 9,077 ÷ 13,857 = 0.66

Ratio	Description	The company
Debt-to-equity ratio	A solvency ratio calculated as total debt divided by total shareholders' equity.	Lowe's Cos. Inc.'s debt-to-equity ratio deteriorated from 2011 to 2012 and from 2012 to 2013.

	Feb 1, 2013	Feb 3, 2012	Jan 28, 2011	Jan 29, 2010	Jan 30, 2009	Feb 1, 2008
Selected Financial Data (USD $ in millions)
Short-term borrowings	–	–	–	–	987	1,064
Current maturities of long-term debt	47	592	36	552	34	40
Long-term debt, excluding current maturities	9,030	7,035	6,537	4,528	5,039	5,576
Total debt	9,077	7,627	6,573	5,080	6,060	6,680
Shareholders' equity	13,857	16,533	18,112	19,069	18,055	16,098
Total capital	22,934	24,160	24,685	24,149	24,115	22,778
Debt to Capital, Comparison to Industry
Lowe's Cos. Inc.¹	0.40	0.32	0.27	0.21	0.25	0.29
Industry, Consumer Services	–	0.37	0.36	0.33	0.35	0.40

Source: Based on data from Lowe's Cos. Inc. Annual Reports

2013 Calculations

¹ Debt to capital = Total debt ÷ Total capital
= 9,077 ÷ 22,934 = 0.40

Ratio	Description	The company
Debt-to-capital ratio	A solvency ratio calculated as total debt divided by total debt plus shareholders' equity.	Lowe's Cos. Inc.'s debt-to-capital ratio deteriorated from 2011 to 2012 and from 2012 to 2013.

	Feb 1, 2013	Feb 3, 2012	Jan 28, 2011	Jan 29, 2010	Jan 30, 2009	Feb 1, 2008
Selected Financial Data (USD $ in millions)
Net earnings	1,959	1,839	2,010	1,783	2,195	2,809
Add: Interest expense	432	383	344	304	320	239
Add: Income tax expense (benefit)	1,178	1,067	1,218	1,042	1,311	1,702
Earnings before interest and tax (EBIT)	3,569	3,289	3,572	3,129	3,826	4,750
Interest Coverage, Comparison to Industry
Lowe's Cos. Inc.¹	8.26	8.59	10.38	10.29	11.96	19.87
Industry, Consumer Services	–	10.71	11.03	9.88	9.07	6.02

Source: Based on data from Lowe's Cos. Inc. Annual Reports

2013 Calculations

¹ Interest coverage = EBIT ÷ Interest expense
= 3,569 ÷ 432 = 8.26

Ratio	Description	The company
Interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments.	Lowe's Cos. Inc.'s interest coverage ratio deteriorated from 2011 to 2012 and from 2012 to 2013.