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Alphabet Inc. (GOOG)
Long-term Debt and Solvency Analysis
Difficulty: Beginner
Solvency ratios also known as long-term debt ratios measure a company’s ability to meet long-term obligations.
Ratios (Summary)
Alphabet Inc., debt and solvency ratios
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Debt Ratios | ||||||
| Debt to equity | |
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| Debt to capital | |
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| Debt to assets | |
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| Financial leverage | |
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| Coverage Ratios | ||||||
| Interest coverage | |
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| Fixed charge coverage | |
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Based on: 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11), 10-K (filing date: 2015-02-09).
| Ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Alphabet Inc.’s debt to equity ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | Alphabet Inc.’s debt to capital ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | Alphabet Inc.’s debt to assets ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Alphabet Inc.’s financial leverage ratio deteriorated from 2016 to 2017 and from 2017 to 2018. |
| Ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | Alphabet Inc.’s interest coverage ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | Alphabet Inc.’s fixed charge coverage ratio deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level. |
Debt to Equity
Alphabet Inc., debt to equity calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | ||||||
| Short-term debt | |
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| Long-term debt, excluding short-term portion | |
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| Total debt | |
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| Stockholders’ equity | |
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| Ratio | ||||||
| Debt to equity1 | |
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| Benchmarks | ||||||
| Debt to Equity, Competitors2 | ||||||
| Adobe Inc. | |
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| Facebook Inc. | |
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| International Business Machines Corp. | |
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| Intuit Inc. | |
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| Microsoft Corp. | |
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| Oracle Corp. | |
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| salesforce.com inc. | |
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| Debt to Equity, Sector | ||||||
| Software & Computer Services | |
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| Debt to Equity, Industry | ||||||
| Technology | |
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Based on: 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11), 10-K (filing date: 2015-02-09).
1 2018 Calculation
Debt to equity = Total debt ÷ Stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
| Ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Alphabet Inc.’s debt to equity ratio improved from 2016 to 2017 and from 2017 to 2018. |
Debt to Capital
Alphabet Inc., debt to capital calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | ||||||
| Short-term debt | |
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| Long-term debt, excluding short-term portion | |
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| Total debt | |
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| Stockholders’ equity | |
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| Total capital | |
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| Ratio | ||||||
| Debt to capital1 | |
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| Benchmarks | ||||||
| Debt to Capital, Competitors2 | ||||||
| Adobe Inc. | |
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| Facebook Inc. | |
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| International Business Machines Corp. | |
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| Intuit Inc. | |
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| Microsoft Corp. | |
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| Oracle Corp. | |
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| salesforce.com inc. | |
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| Debt to Capital, Sector | ||||||
| Software & Computer Services | |
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| Debt to Capital, Industry | ||||||
| Technology | |
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Based on: 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11), 10-K (filing date: 2015-02-09).
1 2018 Calculation
Debt to capital = Total debt ÷ Total capital
= ÷ =
2 Click competitor name to see calculations.
| Ratio | Description | The company |
|---|---|---|
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | Alphabet Inc.’s debt to capital ratio improved from 2016 to 2017 and from 2017 to 2018. |
Debt to Assets
Alphabet Inc., debt to assets calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | ||||||
| Short-term debt | |
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| Long-term debt, excluding short-term portion | |
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| Total debt | |
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| Total assets | |
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| Ratio | ||||||
| Debt to assets1 | |
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| Benchmarks | ||||||
| Debt to Assets, Competitors2 | ||||||
| Adobe Inc. | |
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|
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| Facebook Inc. | |
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|
|
|
| International Business Machines Corp. | |
|
|
|
|
|
| Intuit Inc. | |
|
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|
|
|
| Microsoft Corp. | |
|
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| Oracle Corp. | |
|
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|
|
|
| salesforce.com inc. | |
|
|
|
|
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| Debt to Assets, Sector | ||||||
| Software & Computer Services | |
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| Debt to Assets, Industry | ||||||
| Technology | |
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Based on: 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11), 10-K (filing date: 2015-02-09).
1 2018 Calculation
Debt to assets = Total debt ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
| Ratio | Description | The company |
|---|---|---|
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | Alphabet Inc.’s debt to assets ratio improved from 2016 to 2017 and from 2017 to 2018. |
Financial Leverage
Alphabet Inc., financial leverage calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | ||||||
| Total assets | |
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| Stockholders’ equity | |
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| Ratio | ||||||
| Financial leverage1 | |
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| Benchmarks | ||||||
| Financial Leverage, Competitors2 | ||||||
| Adobe Inc. | |
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|
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| Facebook Inc. | |
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|
|
|
| International Business Machines Corp. | |
|
|
|
|
|
| Intuit Inc. | |
|
|
|
|
|
| Microsoft Corp. | |
|
|
|
|
|
| Oracle Corp. | |
|
|
|
|
|
| salesforce.com inc. | |
|
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| Financial Leverage, Sector | ||||||
| Software & Computer Services | |
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| Financial Leverage, Industry | ||||||
| Technology | |
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Based on: 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11), 10-K (filing date: 2015-02-09).
1 2018 Calculation
Financial leverage = Total assets ÷ Stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
| Ratio | Description | The company |
|---|---|---|
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Alphabet Inc.’s financial leverage ratio deteriorated from 2016 to 2017 and from 2017 to 2018. |
Interest Coverage
Alphabet Inc., interest coverage calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (USD $ in millions) | ||||||
| Net income | |
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| Less: Net income from discontinued operations | |
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| Add: Income tax expense | |
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| Add: Interest expense | |
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| Earnings before interest and tax (EBIT) | |
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| Ratio | ||||||
| Interest coverage1 | |
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| Benchmarks | ||||||
| Interest Coverage, Competitors2 | ||||||
| Adobe Inc. | |
|
|
|
|
|
| Facebook Inc. | |
|
|
|
|
|
| International Business Machines Corp. | |
|
|
|
|
|
| Intuit Inc. | |
|
|
|
|
|
| Microsoft Corp. | |
|
|
|
|
|
| Oracle Corp. | |
|
|
|
|
|
| salesforce.com inc. | |
|
|
|
|
|
| Interest Coverage, Sector | ||||||
| Software & Computer Services | |
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| Interest Coverage, Industry | ||||||
| Technology | |
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|
Based on: 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11), 10-K (filing date: 2015-02-09).
1 2018 Calculation
Interest coverage = EBIT ÷ Interest expense
= ÷ =
2 Click competitor name to see calculations.
| Ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | Alphabet Inc.’s interest coverage ratio improved from 2016 to 2017 and from 2017 to 2018. |
Fixed Charge Coverage
Alphabet Inc., fixed charge coverage calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| U.S. federal statutory tax rate | |
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| Selected Financial Data (USD $ in millions) | ||||||
| Net income | |
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| Less: Net income from discontinued operations | |
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| Add: Income tax expense | |
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| Add: Interest expense | |
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| Earnings before interest and tax (EBIT) | |
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| Add: Rent expense under operating leases | |
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| Earnings before fixed charges and tax | |
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| Interest expense | |
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| Rent expense under operating leases | |
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| Adjustment Payment to Class C capital stockholders | |
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| Adjustment Payment to Class C capital stockholders, tax adjustment1 | |
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| Adjustment Payment to Class C capital stockholders, after tax adjustment | |
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| Fixed charges | |
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| Ratio | ||||||
| Fixed charge coverage2 | |
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|
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| Benchmarks | ||||||
| Fixed Charge Coverage, Competitors3 | ||||||
| Adobe Inc. | |
|
|
|
|
|
| Facebook Inc. | |
|
|
|
|
|
| International Business Machines Corp. | |
|
|
|
|
|
| Intuit Inc. | |
|
|
|
|
|
| Microsoft Corp. | |
|
|
|
|
|
| Oracle Corp. | |
|
|
|
|
|
| salesforce.com inc. | |
|
|
|
|
|
| Fixed Charge Coverage, Sector | ||||||
| Software & Computer Services | |
|
|
|
|
|
| Fixed Charge Coverage, Industry | ||||||
| Technology | |
|
|
|
|
|
Based on: 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11), 10-K (filing date: 2015-02-09).
1 2018 Calculation
Adjustment Payment to Class C capital stockholders, tax adjustment = (Adjustment Payment to Class C capital stockholders × U.S. federal statutory tax rate) ÷ (1 − U.S. federal statutory tax rate)
= ( × ) ÷ (1 − ) =
2 2018 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= ÷ =
3 Click competitor name to see calculations.
| Ratio | Description | The company |
|---|---|---|
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | Alphabet Inc.’s fixed charge coverage ratio deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level. |