Analysis of Solvency Ratios
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
McDonald’s Corp., solvency ratios
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | McDonald’s Corp. debt to capital ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | McDonald’s Corp. debt to capital ratio (including operating lease liability) deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | McDonald’s Corp. debt to assets ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023. |
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | McDonald’s Corp. debt to assets ratio (including operating lease liability) deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023. |
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | McDonald’s Corp. interest coverage ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | McDonald’s Corp. fixed charge coverage ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
Debt to Equity
McDonald’s Corp., debt to equity calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Short-term borrowings and current maturities of long-term debt | 2,192,400) | —) | —) | 2,243,600) | 59,100) | |
| Current finance lease liability | 45,500) | 21,500) | —) | —) | —) | |
| Long-term debt, excluding current maturities | 37,152,900) | 35,903,500) | 35,622,700) | 35,196,800) | 34,118,100) | |
| Long-term finance lease liability | 1,530,000) | 1,300,200) | —) | —) | —) | |
| Total debt | 40,920,800) | 37,225,200) | 35,622,700) | 37,440,400) | 34,177,200) | |
| Shareholders’ equity (deficit) | (4,706,700) | (6,003,400) | (4,601,000) | (7,824,900) | (8,210,300) | |
| Solvency Ratio | ||||||
| Debt to equity1 | — | — | — | — | — | |
| Benchmarks | ||||||
| Debt to Equity, Competitors2 | ||||||
| Airbnb Inc. | 0.24 | 0.36 | 0.42 | 0.63 | — | |
| Booking Holdings Inc. | — | 4.51 | 1.77 | 2.46 | 1.45 | |
| Carnival Corp. & plc | 4.44 | 4.89 | 2.74 | 1.31 | 0.45 | |
| Chipotle Mexican Grill Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |
| Starbucks Corp. | — | — | — | — | — | |
| Debt to Equity, Sector | ||||||
| Consumer Services | 38.71 | 33.01 | 6.23 | 6.39 | 3.53 | |
| Debt to Equity, Industry | ||||||
| Consumer Discretionary | 1.42 | 1.61 | 1.56 | 2.26 | 2.44 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to equity = Total debt ÷ Shareholders’ equity (deficit)
= 40,920,800 ÷ -4,706,700 = —
2 Click competitor name to see calculations.
Debt to Equity (including Operating Lease Liability)
McDonald’s Corp., debt to equity (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Short-term borrowings and current maturities of long-term debt | 2,192,400) | —) | —) | 2,243,600) | 59,100) | |
| Current finance lease liability | 45,500) | 21,500) | —) | —) | —) | |
| Long-term debt, excluding current maturities | 37,152,900) | 35,903,500) | 35,622,700) | 35,196,800) | 34,118,100) | |
| Long-term finance lease liability | 1,530,000) | 1,300,200) | —) | —) | —) | |
| Total debt | 40,920,800) | 37,225,200) | 35,622,700) | 37,440,400) | 34,177,200) | |
| Current operating lease liability | 642,600) | 639,600) | 705,500) | 701,500) | 621,000) | |
| Long-term operating lease liability | 11,527,700) | 10,834,200) | 13,020,900) | 13,321,300) | 12,757,800) | |
| Total debt (including operating lease liability) | 53,091,100) | 48,699,000) | 49,349,100) | 51,463,200) | 47,556,000) | |
| Shareholders’ equity (deficit) | (4,706,700) | (6,003,400) | (4,601,000) | (7,824,900) | (8,210,300) | |
| Solvency Ratio | ||||||
| Debt to equity (including operating lease liability)1 | — | — | — | — | — | |
| Benchmarks | ||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||
| Airbnb Inc. | 0.28 | 0.42 | 0.51 | 0.80 | — | |
| Booking Holdings Inc. | — | 4.75 | 1.85 | 2.56 | 1.56 | |
| Carnival Corp. & plc | 4.63 | 5.08 | 2.85 | 1.38 | 0.45 | |
| Chipotle Mexican Grill Inc. | 1.32 | 1.58 | 1.53 | 1.56 | 1.69 | |
| Starbucks Corp. | — | — | — | — | — | |
| Debt to Equity (including Operating Lease Liability), Sector | ||||||
| Consumer Services | 49.14 | 41.60 | 8.07 | 8.32 | 4.44 | |
| Debt to Equity (including Operating Lease Liability), Industry | ||||||
| Consumer Discretionary | 1.77 | 2.00 | 1.93 | 2.69 | 2.70 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Shareholders’ equity (deficit)
= 53,091,100 ÷ -4,706,700 = —
2 Click competitor name to see calculations.
Debt to Capital
McDonald’s Corp., debt to capital calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Short-term borrowings and current maturities of long-term debt | 2,192,400) | —) | —) | 2,243,600) | 59,100) | |
| Current finance lease liability | 45,500) | 21,500) | —) | —) | —) | |
| Long-term debt, excluding current maturities | 37,152,900) | 35,903,500) | 35,622,700) | 35,196,800) | 34,118,100) | |
| Long-term finance lease liability | 1,530,000) | 1,300,200) | —) | —) | —) | |
| Total debt | 40,920,800) | 37,225,200) | 35,622,700) | 37,440,400) | 34,177,200) | |
| Shareholders’ equity (deficit) | (4,706,700) | (6,003,400) | (4,601,000) | (7,824,900) | (8,210,300) | |
| Total capital | 36,214,100) | 31,221,800) | 31,021,700) | 29,615,500) | 25,966,900) | |
| Solvency Ratio | ||||||
| Debt to capital1 | 1.13 | 1.19 | 1.15 | 1.26 | 1.32 | |
| Benchmarks | ||||||
| Debt to Capital, Competitors2 | ||||||
| Airbnb Inc. | 0.20 | 0.26 | 0.29 | 0.39 | — | |
| Booking Holdings Inc. | 1.24 | 0.82 | 0.64 | 0.71 | 0.59 | |
| Carnival Corp. & plc | 0.82 | 0.83 | 0.73 | 0.57 | 0.31 | |
| Chipotle Mexican Grill Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |
| Starbucks Corp. | 2.08 | 2.41 | 1.57 | 1.96 | 2.26 | |
| Debt to Capital, Sector | ||||||
| Consumer Services | 0.97 | 0.97 | 0.86 | 0.86 | 0.78 | |
| Debt to Capital, Industry | ||||||
| Consumer Discretionary | 0.59 | 0.62 | 0.61 | 0.69 | 0.71 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 40,920,800 ÷ 36,214,100 = 1.13
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | McDonald’s Corp. debt to capital ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
Debt to Capital (including Operating Lease Liability)
McDonald’s Corp., debt to capital (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Short-term borrowings and current maturities of long-term debt | 2,192,400) | —) | —) | 2,243,600) | 59,100) | |
| Current finance lease liability | 45,500) | 21,500) | —) | —) | —) | |
| Long-term debt, excluding current maturities | 37,152,900) | 35,903,500) | 35,622,700) | 35,196,800) | 34,118,100) | |
| Long-term finance lease liability | 1,530,000) | 1,300,200) | —) | —) | —) | |
| Total debt | 40,920,800) | 37,225,200) | 35,622,700) | 37,440,400) | 34,177,200) | |
| Current operating lease liability | 642,600) | 639,600) | 705,500) | 701,500) | 621,000) | |
| Long-term operating lease liability | 11,527,700) | 10,834,200) | 13,020,900) | 13,321,300) | 12,757,800) | |
| Total debt (including operating lease liability) | 53,091,100) | 48,699,000) | 49,349,100) | 51,463,200) | 47,556,000) | |
| Shareholders’ equity (deficit) | (4,706,700) | (6,003,400) | (4,601,000) | (7,824,900) | (8,210,300) | |
| Total capital (including operating lease liability) | 48,384,400) | 42,695,600) | 44,748,100) | 43,638,300) | 39,345,700) | |
| Solvency Ratio | ||||||
| Debt to capital (including operating lease liability)1 | 1.10 | 1.14 | 1.10 | 1.18 | 1.21 | |
| Benchmarks | ||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||
| Airbnb Inc. | 0.22 | 0.30 | 0.34 | 0.44 | — | |
| Booking Holdings Inc. | 1.22 | 0.83 | 0.65 | 0.72 | 0.61 | |
| Carnival Corp. & plc | 0.82 | 0.84 | 0.74 | 0.58 | 0.31 | |
| Chipotle Mexican Grill Inc. | 0.57 | 0.61 | 0.61 | 0.61 | 0.63 | |
| Starbucks Corp. | 1.48 | 1.58 | 1.29 | 1.46 | 2.26 | |
| Debt to Capital (including Operating Lease Liability), Sector | ||||||
| Consumer Services | 0.98 | 0.98 | 0.89 | 0.89 | 0.82 | |
| Debt to Capital (including Operating Lease Liability), Industry | ||||||
| Consumer Discretionary | 0.64 | 0.67 | 0.66 | 0.73 | 0.73 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 53,091,100 ÷ 48,384,400 = 1.10
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | McDonald’s Corp. debt to capital ratio (including operating lease liability) deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
Debt to Assets
McDonald’s Corp., debt to assets calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Short-term borrowings and current maturities of long-term debt | 2,192,400) | —) | —) | 2,243,600) | 59,100) | |
| Current finance lease liability | 45,500) | 21,500) | —) | —) | —) | |
| Long-term debt, excluding current maturities | 37,152,900) | 35,903,500) | 35,622,700) | 35,196,800) | 34,118,100) | |
| Long-term finance lease liability | 1,530,000) | 1,300,200) | —) | —) | —) | |
| Total debt | 40,920,800) | 37,225,200) | 35,622,700) | 37,440,400) | 34,177,200) | |
| Total assets | 56,146,800) | 50,435,600) | 53,854,300) | 52,626,800) | 47,510,800) | |
| Solvency Ratio | ||||||
| Debt to assets1 | 0.73 | 0.74 | 0.66 | 0.71 | 0.72 | |
| Benchmarks | ||||||
| Debt to Assets, Competitors2 | ||||||
| Airbnb Inc. | 0.10 | 0.12 | 0.14 | 0.17 | — | |
| Booking Holdings Inc. | 0.59 | 0.49 | 0.46 | 0.55 | 0.40 | |
| Carnival Corp. & plc | 0.62 | 0.67 | 0.62 | 0.50 | 0.26 | |
| Chipotle Mexican Grill Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |
| Starbucks Corp. | 0.52 | 0.53 | 0.47 | 0.54 | 0.58 | |
| Debt to Assets, Sector | ||||||
| Consumer Services | 0.55 | 0.57 | 0.53 | 0.54 | 0.47 | |
| Debt to Assets, Industry | ||||||
| Consumer Discretionary | 0.35 | 0.36 | 0.37 | 0.42 | 0.44 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to assets = Total debt ÷ Total assets
= 40,920,800 ÷ 56,146,800 = 0.73
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | McDonald’s Corp. debt to assets ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023. |
Debt to Assets (including Operating Lease Liability)
McDonald’s Corp., debt to assets (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Short-term borrowings and current maturities of long-term debt | 2,192,400) | —) | —) | 2,243,600) | 59,100) | |
| Current finance lease liability | 45,500) | 21,500) | —) | —) | —) | |
| Long-term debt, excluding current maturities | 37,152,900) | 35,903,500) | 35,622,700) | 35,196,800) | 34,118,100) | |
| Long-term finance lease liability | 1,530,000) | 1,300,200) | —) | —) | —) | |
| Total debt | 40,920,800) | 37,225,200) | 35,622,700) | 37,440,400) | 34,177,200) | |
| Current operating lease liability | 642,600) | 639,600) | 705,500) | 701,500) | 621,000) | |
| Long-term operating lease liability | 11,527,700) | 10,834,200) | 13,020,900) | 13,321,300) | 12,757,800) | |
| Total debt (including operating lease liability) | 53,091,100) | 48,699,000) | 49,349,100) | 51,463,200) | 47,556,000) | |
| Total assets | 56,146,800) | 50,435,600) | 53,854,300) | 52,626,800) | 47,510,800) | |
| Solvency Ratio | ||||||
| Debt to assets (including operating lease liability)1 | 0.95 | 0.97 | 0.92 | 0.98 | 1.00 | |
| Benchmarks | ||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||
| Airbnb Inc. | 0.11 | 0.15 | 0.18 | 0.22 | — | |
| Booking Holdings Inc. | 0.62 | 0.52 | 0.48 | 0.57 | 0.43 | |
| Carnival Corp. & plc | 0.65 | 0.69 | 0.65 | 0.53 | 0.26 | |
| Chipotle Mexican Grill Inc. | 0.50 | 0.54 | 0.53 | 0.53 | 0.56 | |
| Starbucks Corp. | 0.83 | 0.84 | 0.75 | 0.84 | 0.58 | |
| Debt to Assets (including Operating Lease Liability), Sector | ||||||
| Consumer Services | 0.70 | 0.71 | 0.68 | 0.71 | 0.60 | |
| Debt to Assets (including Operating Lease Liability), Industry | ||||||
| Consumer Discretionary | 0.44 | 0.45 | 0.45 | 0.50 | 0.48 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 53,091,100 ÷ 56,146,800 = 0.95
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | McDonald’s Corp. debt to assets ratio (including operating lease liability) deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023. |
Financial Leverage
McDonald’s Corp., financial leverage calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Total assets | 56,146,800) | 50,435,600) | 53,854,300) | 52,626,800) | 47,510,800) | |
| Shareholders’ equity (deficit) | (4,706,700) | (6,003,400) | (4,601,000) | (7,824,900) | (8,210,300) | |
| Solvency Ratio | ||||||
| Financial leverage1 | — | — | — | — | — | |
| Benchmarks | ||||||
| Financial Leverage, Competitors2 | ||||||
| Airbnb Inc. | 2.53 | 2.88 | 2.87 | 3.62 | — | |
| Booking Holdings Inc. | — | 9.12 | 3.83 | 4.47 | 3.61 | |
| Carnival Corp. & plc | 7.14 | 7.32 | 4.39 | 2.61 | 1.78 | |
| Chipotle Mexican Grill Inc. | 2.63 | 2.93 | 2.90 | 2.96 | 3.03 | |
| Starbucks Corp. | — | — | — | — | — | |
| Financial Leverage, Sector | ||||||
| Consumer Services | 70.48 | 58.22 | 11.80 | 11.80 | 7.46 | |
| Financial Leverage, Industry | ||||||
| Consumer Discretionary | 4.04 | 4.43 | 4.25 | 5.41 | 5.56 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Financial leverage = Total assets ÷ Shareholders’ equity (deficit)
= 56,146,800 ÷ -4,706,700 = —
2 Click competitor name to see calculations.
Interest Coverage
McDonald’s Corp., interest coverage calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income | 8,468,800) | 6,177,400) | 7,545,200) | 4,730,500) | 6,025,400) | |
| Add: Income tax expense | 2,053,400) | 1,648,000) | 1,582,700) | 1,410,200) | 1,992,700) | |
| Add: Interest expense, net of capitalized interest | 1,360,800) | 1,207,000) | 1,185,800) | 1,218,100) | 1,121,900) | |
| Earnings before interest and tax (EBIT) | 11,883,000) | 9,032,400) | 10,313,700) | 7,358,800) | 9,140,000) | |
| Solvency Ratio | ||||||
| Interest coverage1 | 8.73 | 7.48 | 8.70 | 6.04 | 8.15 | |
| Benchmarks | ||||||
| Interest Coverage, Competitors2 | ||||||
| Airbnb Inc. | 26.33 | 83.88 | 0.31 | -26.27 | — | |
| Booking Holdings Inc. | 7.11 | 11.03 | 5.39 | 2.59 | 23.40 | |
| Carnival Corp. & plc | 0.97 | -2.78 | -4.95 | -10.46 | 15.86 | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| Starbucks Corp. | 10.82 | 9.76 | 12.40 | 3.66 | 14.49 | |
| Interest Coverage, Sector | ||||||
| Consumer Services | 6.06 | 4.52 | 2.72 | -1.20 | 12.41 | |
| Interest Coverage, Industry | ||||||
| Consumer Discretionary | 10.61 | 7.74 | 10.83 | 6.26 | 9.85 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Interest coverage = EBIT ÷ Interest expense
= 11,883,000 ÷ 1,360,800 = 8.73
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | McDonald’s Corp. interest coverage ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
Fixed Charge Coverage
McDonald’s Corp., fixed charge coverage calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income | 8,468,800) | 6,177,400) | 7,545,200) | 4,730,500) | 6,025,400) | |
| Add: Income tax expense | 2,053,400) | 1,648,000) | 1,582,700) | 1,410,200) | 1,992,700) | |
| Add: Interest expense, net of capitalized interest | 1,360,800) | 1,207,000) | 1,185,800) | 1,218,100) | 1,121,900) | |
| Earnings before interest and tax (EBIT) | 11,883,000) | 9,032,400) | 10,313,700) | 7,358,800) | 9,140,000) | |
| Add: Rent expense | 1,542,300) | 1,476,100) | 1,560,300) | 1,479,300) | 1,606,800) | |
| Earnings before fixed charges and tax | 13,425,300) | 10,508,500) | 11,874,000) | 8,838,100) | 10,746,800) | |
| Interest expense, net of capitalized interest | 1,360,800) | 1,207,000) | 1,185,800) | 1,218,100) | 1,121,900) | |
| Rent expense | 1,542,300) | 1,476,100) | 1,560,300) | 1,479,300) | 1,606,800) | |
| Fixed charges | 2,903,100) | 2,683,100) | 2,746,100) | 2,697,400) | 2,728,700) | |
| Solvency Ratio | ||||||
| Fixed charge coverage1 | 4.62 | 3.92 | 4.32 | 3.28 | 3.94 | |
| Benchmarks | ||||||
| Fixed Charge Coverage, Competitors2 | ||||||
| Airbnb Inc. | 15.91 | 20.69 | 0.42 | -16.81 | — | |
| Booking Holdings Inc. | 6.09 | 8.12 | 3.82 | 2.03 | 14.27 | |
| Carnival Corp. & plc | 0.97 | -2.38 | -4.28 | -8.34 | 15.86 | |
| Chipotle Mexican Grill Inc. | 4.71 | 3.98 | 3.23 | 1.88 | 2.49 | |
| Starbucks Corp. | 3.51 | 3.08 | 3.61 | 1.58 | 3.52 | |
| Fixed Charge Coverage, Sector | ||||||
| Consumer Services | 3.79 | 2.73 | 1.87 | 0.03 | 5.02 | |
| Fixed Charge Coverage, Industry | ||||||
| Consumer Discretionary | 4.73 | 3.37 | 5.01 | 3.19 | 4.32 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 13,425,300 ÷ 2,903,100 = 4.62
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | McDonald’s Corp. fixed charge coverage ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |