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Medco Health Solutions Inc. (MHS) | Long-term Debt and Solvency Analysis

Solvency ratios also known as long-term debt ratios measure a company's ability to meet long-term obligations.


Ratios (Summary)

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Medco Health Solutions Inc., debt and solvency ratios

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    Dec 25, 2010 Dec 26, 2009 Dec 27, 2008 Dec 29, 2007 Dec 30, 2006
Debt to equity
Debt to capital
Interest coverage

Source: Based on data from Medco Health Solutions Inc. Annual Reports

Ratio Description The company
Debt-to-equity ratio A solvency ratio calculated as total debt divided by total shareholders' equity. Medco Health Solutions Inc.'s debt-to-equity ratio improved from 2008 to 2009 but then deteriorated significantly from 2009 to 2010.
Debt-to-capital ratio A solvency ratio calculated as total debt divided by total debt plus shareholders' equity. Medco Health Solutions Inc.'s debt-to-capital ratio improved from 2008 to 2009 but then deteriorated significantly from 2009 to 2010.
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. Medco Health Solutions Inc.'s interest coverage ratio improved from 2008 to 2009 and from 2009 to 2010.

Debt to Equity

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    Dec 25, 2010 Dec 26, 2009 Dec 27, 2008 Dec 29, 2007 Dec 30, 2006
  Selected Financial Data (USD $ in thousands)
Short-term debt
Current portion of long-term debt
Long-term debt, excluding current portion, net
Total debt
Stockholders’ equity
  Debt to Equity, Comparison to Industry
Medco Health Solutions Inc.1
  Industry, Health Care

Source: Based on data from Medco Health Solutions Inc. Annual Reports

2010 Calculations

1 Debt to equity = Total debt ÷ Stockholders’ equity
= ÷ =

Ratio Description The company
Debt-to-equity ratio A solvency ratio calculated as total debt divided by total shareholders' equity. Medco Health Solutions Inc.'s debt-to-equity ratio improved from 2008 to 2009 but then deteriorated significantly from 2009 to 2010.

Debt to Capital

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    Dec 25, 2010 Dec 26, 2009 Dec 27, 2008 Dec 29, 2007 Dec 30, 2006
  Selected Financial Data (USD $ in thousands)
Short-term debt
Current portion of long-term debt
Long-term debt, excluding current portion, net
Total debt
Stockholders’ equity
Total capital
  Debt to Capital, Comparison to Industry
Medco Health Solutions Inc.1
  Industry, Health Care

Source: Based on data from Medco Health Solutions Inc. Annual Reports

2010 Calculations

1 Debt to capital = Total debt ÷ Total capital
= ÷ =

Ratio Description The company
Debt-to-capital ratio A solvency ratio calculated as total debt divided by total debt plus shareholders' equity. Medco Health Solutions Inc.'s debt-to-capital ratio improved from 2008 to 2009 but then deteriorated significantly from 2009 to 2010.

Interest Coverage

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    Dec 25, 2010 Dec 26, 2009 Dec 27, 2008 Dec 29, 2007 Dec 30, 2006
  Selected Financial Data (USD $ in thousands)
Net income
Add: Interest expense
Add: Income tax expense (benefit)
Earnings before interest and tax (EBIT)
  Interest Coverage, Comparison to Industry
Medco Health Solutions Inc.1
  Industry, Health Care

Source: Based on data from Medco Health Solutions Inc. Annual Reports

2010 Calculations

1 Interest coverage = EBIT ÷ Interest expense
= ÷ =

Ratio Description The company
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. Medco Health Solutions Inc.'s interest coverage ratio improved from 2008 to 2009 and from 2009 to 2010.

February 8, 2012

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