Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
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- Analysis of Geographic Areas
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Selected Financial Data since 2008
- Net Profit Margin since 2008
- Operating Profit Margin since 2008
- Return on Equity (ROE) since 2008
- Price to Operating Profit (P/OP) since 2008
- Price to Sales (P/S) since 2008
- Aggregate Accruals
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Solvency Ratios (Summary)
Keurig Dr Pepper Inc., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
- Debt to Equity Ratio
- The debt to equity ratio exhibits a gradual declining trend over the observed periods. Starting at 0.67 in March 2019, it steadily decreases to around 0.45-0.46 by mid-2022. This indicates a consistent reduction in the company's reliance on debt relative to equity, reflecting a strengthening equity base or a reduction in debt levels over time.
- Debt to Capital Ratio
- This ratio also shows a subtle but persistent decline, moving from 0.40 in early 2019 to approximately 0.31 by mid-2022. The decreasing debt to capital ratio suggests an ongoing improvement in the company’s capital structure, with less leverage being employed in its financing mix.
- Debt to Assets Ratio
- The debt to assets ratio decreases from 0.31 in the first quarter of 2019 to around 0.22-0.23 in the mid-2022 periods. This consistent reduction implies that a smaller proportion of the total assets is financed by debt, pointing to enhanced asset financing stability and potentially lower financial risk.
- Financial Leverage Ratio
- The financial leverage ratio remains relatively stable but exhibits a modest downward drift over the timeframe. Beginning at 2.17 in March 2019, it declines to approximately 2.01-2.03 by mid-2022. This trend aligns with the decreasing debt ratios and indicates slight deleveraging while maintaining a moderate degree of leverage.
- Interest Coverage Ratio
- Interest coverage data is available from the end of 2019 onward and shows a clear upward trajectory. Starting at 3.59 in December 2019, the ratio improves markedly to a peak of 6.78 by June 2022, before slightly retreating to 5.62 in the most recent quarter. This significant increase reflects enhanced earnings capacity relative to interest expense, suggesting stronger operational earnings or a reduction in interest costs, both of which improve the company’s ability to cover interest obligations comfortably.
Debt Ratios
Coverage Ratios
Debt to Equity
Keurig Dr Pepper Inc., debt to equity calculation (quarterly data)
| 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||
| Short-term borrowings and current portion of long-term obligations | |||||||||||||||||||
| Long-term obligations, excluding current portion | |||||||||||||||||||
| Total debt | |||||||||||||||||||
| Stockholders’ equity | |||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||
| Debt to equity1 | |||||||||||||||||||
| Benchmarks | |||||||||||||||||||
| Debt to Equity, Competitors2 | |||||||||||||||||||
| Coca-Cola Co. | |||||||||||||||||||
| Mondelēz International Inc. | |||||||||||||||||||
| PepsiCo Inc. | |||||||||||||||||||
| Philip Morris International Inc. | |||||||||||||||||||
Based on: 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2022 Calculation
Debt to equity = Total debt ÷ Stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals a consistent decline in total debt over the observed periods, decreasing from approximately 15,264 million US dollars at the end of the first quarter of 2019 to around 11,555 million US dollars by the second quarter of 2022. This indicates a deliberate effort to reduce leverage over time.
Concurrently, stockholders' equity shows a general upward trend, increasing from roughly 22,674 million US dollars at the beginning of the period to about 25,391 million US dollars by mid-2022. This growth in equity suggests sustained accumulation of retained earnings or other equity-related enhancements.
As a result of these movements in debt and equity, the debt to equity ratio steadily decreases throughout the timeline. Starting at 0.67 in the first quarter of 2019, the ratio falls to a low of 0.45 by the first quarter of 2022 before slightly adjusting to 0.46 by the second quarter. This decreasing ratio reflects a strengthening capital structure with lower relative debt burden compared to shareholder equity.
In summary, the trends indicate a strategic reduction in financial leverage accompanied by growth in equity base, signifying improved solvency and a potentially lower financial risk profile over the respective quarters.
- Total Debt
- Consistent decline from 15,264 million to 11,555 million US dollars over the period.
- Stockholders’ Equity
- Gradual increase from 22,674 million to 25,391 million US dollars.
- Debt to Equity Ratio
- Decrease from 0.67 to 0.46, indicating reduced leverage and stronger equity position.
Debt to Capital
Keurig Dr Pepper Inc., debt to capital calculation (quarterly data)
| 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||
| Short-term borrowings and current portion of long-term obligations | |||||||||||||||||||
| Long-term obligations, excluding current portion | |||||||||||||||||||
| Total debt | |||||||||||||||||||
| Stockholders’ equity | |||||||||||||||||||
| Total capital | |||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||
| Debt to capital1 | |||||||||||||||||||
| Benchmarks | |||||||||||||||||||
| Debt to Capital, Competitors2 | |||||||||||||||||||
| Coca-Cola Co. | |||||||||||||||||||
| Mondelēz International Inc. | |||||||||||||||||||
| PepsiCo Inc. | |||||||||||||||||||
| Philip Morris International Inc. | |||||||||||||||||||
Based on: 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2022 Calculation
Debt to capital = Total debt ÷ Total capital
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals a consistent decrease in the company's total debt over the observed periods, indicating ongoing debt reduction efforts. The total debt diminished from approximately US$15,264 million in the first quarter of 2019 to around US$11,555 million by the second quarter of 2022. This decline appears steady and continuous across all quarters, reflecting a firm commitment to lowering leverage.
Total capital remained relatively stable throughout the timeframe, fluctuating slightly but maintaining a range close to US$37,000 million. Initial capital stood at about US$37,938 million in the first quarter of 2019 and experienced minor declines and recoveries up to US$36,946 million by mid-2022. This relative stability in capital suggests that changes in debt have not been accompanied by significant equity adjustments or capital restructurings.
Consistent with the reduction in total debt and the steadiness of total capital, the debt-to-capital ratio shows a gradual decrease from 0.40 in early 2019 to approximately 0.31 in mid-2022. This downward trend indicates an improvement in the company's capital structure, with debt constituting a smaller proportion of total capital over time. This pattern suggests a strengthening financial position and potentially enhanced creditworthiness.
- Total Debt
- Steady decline from US$15,264 million to US$11,555 million over 13 quarters, reflecting active debt reduction.
- Total Capital
- Relatively stable, fluctuating modestly around US$37 billion; no significant capital infusion or depletion trends detected.
- Debt-to-Capital Ratio
- Decreased steadily from 0.40 to 0.31, signifying reduced leverage and an improving balance sheet composition.
Overall, the financial data illustrate a company that is progressively improving its leverage position by reducing debt while maintaining a stable capital base, which may enhance financial stability and lower financing risk over the observed periods.
Debt to Assets
Keurig Dr Pepper Inc., debt to assets calculation (quarterly data)
| Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||
| Short-term borrowings and current portion of long-term obligations | |||||||||||||||||||
| Long-term obligations, excluding current portion | |||||||||||||||||||
| Total debt | |||||||||||||||||||
| Total assets | |||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||
| Debt to assets1 | |||||||||||||||||||
| Benchmarks | |||||||||||||||||||
| Debt to Assets, Competitors2 | |||||||||||||||||||
| Coca-Cola Co. | |||||||||||||||||||
| Mondelēz International Inc. | |||||||||||||||||||
| PepsiCo Inc. | |||||||||||||||||||
| Philip Morris International Inc. | |||||||||||||||||||
Based on: 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2022 Calculation
Debt to assets = Total debt ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The analysis of the financial data over the observed periods reveals several significant trends regarding the company's leverage and asset base.
- Total Debt
- The total debt consistently decreased from the first quarter of 2019 to the second quarter of 2022. Starting at approximately $15,264 million in March 2019, it declined steadily to $11,555 million by June 2022. This downward trend indicates ongoing debt reduction initiatives or repayment strategies over the four-year period.
- Total Assets
- Total assets displayed relative stability with a slight upward trend. From an initial value near $49,291 million in March 2019, assets fluctuated mildly but increased to $51,428 million by June 2022. This modest growth suggests either asset accumulation or appreciation, contributing to an overall strengthening of the asset base.
- Debt to Assets Ratio
- The debt to assets ratio progressively declined throughout the timeframe, starting at 0.31 in March 2019 and falling to 0.22 by June 2022. This continuous decrease reflects a consistent improvement in the company’s financial leverage, implying reduced financial risk and potentially stronger creditworthiness. The ratio decline aligns with the reduction in total debt coupled with the slight rise in total assets.
In summary, the company demonstrated prudent financial management by lowering its debt levels steadily while maintaining or growing its asset base, resulting in a more conservative capital structure and improved leverage ratios over the analyzed quarters.
Financial Leverage
Keurig Dr Pepper Inc., financial leverage calculation (quarterly data)
| Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||
| Total assets | |||||||||||||||||||
| Stockholders’ equity | |||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||
| Financial leverage1 | |||||||||||||||||||
| Benchmarks | |||||||||||||||||||
| Financial Leverage, Competitors2 | |||||||||||||||||||
| Coca-Cola Co. | |||||||||||||||||||
| Mondelēz International Inc. | |||||||||||||||||||
| PepsiCo Inc. | |||||||||||||||||||
| Philip Morris International Inc. | |||||||||||||||||||
Based on: 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2022 Calculation
Financial leverage = Total assets ÷ Stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
- Total assets
- The total assets exhibit a generally stable and slightly increasing trend over the observed periods. Starting at 49,291 million US dollars in March 2019, the assets fluctuated marginally around the 49,500 million mark throughout 2019 and 2020. From March 2021 onward, there is a clearer upward trajectory, reaching 51,428 million US dollars by June 2022. This suggests steady growth in asset base over the long term.
- Stockholders' equity
- Stockholders’ equity shows a gradual and consistent increase across the quarters. Beginning at 22,674 million US dollars in March 2019, the equity grew steadily, reaching 25,511 million US dollars by March 2022 before a slight dip to 25,391 million US dollars in June 2022. The upward trend indicates strengthening equity position, reflecting either retained earnings accumulation or capital injections over time.
- Financial leverage
- The financial leverage ratio demonstrates a consistent downward trend, declining from 2.17 in March 2019 to around 2.01-2.03 in 2022. This decrease indicates a reduction in the company's reliance on debt relative to equity. The movement toward lower leverage suggests an improving financial structure with potentially reduced risk exposure related to debt obligations.
Interest Coverage
Keurig Dr Pepper Inc., interest coverage calculation (quarterly data)
| 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||
| Net income attributable to KDP | |||||||||||||||||||
| Add: Net income attributable to noncontrolling interest | |||||||||||||||||||
| Add: Income tax expense | |||||||||||||||||||
| Add: Interest expense | |||||||||||||||||||
| Earnings before interest and tax (EBIT) | |||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||
| Interest coverage1 | |||||||||||||||||||
| Benchmarks | |||||||||||||||||||
| Interest Coverage, Competitors2 | |||||||||||||||||||
| Coca-Cola Co. | |||||||||||||||||||
Based on: 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2022 Calculation
Interest coverage
= (EBITQ2 2022
+ EBITQ1 2022
+ EBITQ4 2021
+ EBITQ3 2021)
÷ (Interest expenseQ2 2022
+ Interest expenseQ1 2022
+ Interest expenseQ4 2021
+ Interest expenseQ3 2021)
= ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The analysis of the financial data reveals notable fluctuations and trends across the reported periods.
- Earnings Before Interest and Tax (EBIT)
- The EBIT exhibits a varying pattern over the observed quarters. The figures initially show an incremental trend from $484 million in the first quarter of 2019 to a peak at $707 million at the end of 2019. This growth is followed by a significant decline in early 2020, dropping to $358 million in the first quarter of that year. Subsequently, EBIT recovers and rises again through the remainder of 2020 and into 2021, reaching a new high of $1,228 million in the last quarter of 2021. However, the first two quarters of 2022 indicate a sharp decrease, with EBIT falling back to $953 million and then further down to $388 million. The volatility suggests sensitivity to external economic conditions or operational changes affecting profitability.
- Interest Expense
- Interest expense displays a generally declining trend from 2019 through mid-2021. Starting at $169 million in the first quarter of 2019, this expense gradually decreases, reaching a low of $116 million in the third quarter of 2021. This reduction could imply improved debt management or refinancing at more favorable rates. Nevertheless, from the last quarter of 2021 into 2022, interest expenses escalate again, rising to $188 million and $175 million in the first two quarters, respectively, suggesting increased borrowing costs or additional debt.
- Interest Coverage Ratio
- The interest coverage ratio, which reflects the firm's ability to meet its interest obligations, is available from the first quarter of 2020 onward and shows a generally positive trend. Initially at 3.59, it experiences a steady increase through 2020 and 2021, peaking at 6.78 in the second quarter of 2022. This indicates improved capacity to cover interest expenses through earnings, despite the recent uptick in interest costs. However, the slight decline to 5.62 in the latest quarter signals some pressure on coverage capacity, likely linked to the corresponding reduction in EBIT.
Overall, the data reflects an environment of fluctuating operating profitability, with earnings volatility potentially driven by market or internal factors. The decreasing interest expense through most of the period suggests effective debt and cost management, while recent increases point to changing financial conditions. The improved interest coverage ratio over time suggests enhanced financial resilience, albeit with some recent mild weakening.