Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
O’Reilly Automotive Inc., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
The analysis of leverage and coverage ratios over the examined quarters reveals notable fluctuations and trends in the company's financial structure and capacity to meet interest obligations.
- Debt to Equity
- The debt to equity ratio exhibited considerable volatility, with values fluctuating widely over the periods. Early data show moderate ratios around 7.5 to 9.7, before spiking dramatically to above 40 in early 2020, followed by a decline and further irregular movements. The inclusion of operating lease liabilities consistently raised the ratio, accentuating the leverage particularly during mid-2019 to late 2020 periods.
- Debt to Capital
- This ratio hovered near high levels throughout, starting around 0.86 to 0.91 in 2018 and gradually increasing to and above 1.00 by 2021 and beyond, indicating a growing portion of debt financing relative to total capital. Including lease liabilities slightly raised the ratio, though the trend mirrored the base ratio.
- Debt to Assets
- Debt relative to assets remained in a moderate range, fluctuating between approximately 0.32 and 0.43 in the earlier periods without a clear upward or downward trend. When operating lease liabilities were included, this ratio displayed elevated values around 0.5 to 0.58, suggesting a significant impact of leases on reported asset-related leverage.
- Financial Leverage
- Financial leverage ratios presented marked swings, notably peaking at over 100 in early 2020 and also reaching high levels above 80 at the end of 2020. These sharp increases indicate periods of potentially heightened risk or aggressive leverage strategies. Post these spikes, the data are sparse but indicate continued elevated leverage levels in certain quarters.
- Interest Coverage
- The interest coverage ratio maintained a generally positive trend, gradually improving from approximately 15 in 2018 to over 20 by mid-2022. This suggests an increasing ability to cover interest expenses over time despite fluctuations in leverage ratios, indicating strengthened earnings or reduced interest burdens relative to earnings.
Overall, the company's leverage profile experienced significant variability, particularly evident in the debt to equity and financial leverage ratios, reflecting periods of increased borrowing or asset reclassification including lease liabilities. However, the interest coverage ratio's improving trajectory may imply enhanced operational performance or cost management mitigating the risks associated with rising debt levels.
Debt Ratios
Coverage Ratios
Debt to Equity
O’Reilly Automotive Inc., debt to equity calculation (quarterly data)
| Sep 30, 2022 | 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current portion of long-term debt | —) | —) | —) | —) | —) | —) | 299,880) | —) | 499,783) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, less current portion | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 3,824,288) | 4,123,217) | 4,122,424) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total debt | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 4,124,168) | 4,123,217) | 4,622,207) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Shareholders’ equity (deficit) | (1,205,463) | (1,107,430) | (328,273) | (66,423) | (140,853) | 217,694) | (6,977) | 140,258) | 709,225) | 589,100) | 108,844) | 397,340) | 166,219) | 144,682) | 372,365) | 353,667) | 498,379) | 384,990) | 423,828) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Debt to equity1 | — | — | — | — | — | 17.57 | — | 29.40 | 6.52 | 7.01 | 41.08 | 9.79 | 22.28 | 26.15 | 9.29 | 9.66 | 6.37 | 8.45 | 7.53 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Debt to Equity, Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 0.58 | 0.62 | 0.53 | 0.54 | 0.63 | 0.67 | 0.58 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 37.82 | 17.48 | 20.52 | 11.29 | 23.01 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lowe’s Cos. Inc. | — | — | 52.23 | 15.16 | 5.35 | 5.01 | 12.71 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| TJX Cos. Inc. | 0.52 | 0.52 | 0.87 | 1.04 | 1.11 | 1.33 | 1.52 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Debt to equity = Total debt ÷ Shareholders’ equity (deficit)
= 4,370,772 ÷ -1,205,463 = —
2 Click competitor name to see calculations.
- Total Debt
- The total debt exhibited a generally increasing trend from March 2018 through September 2022. Starting at approximately $3.19 billion in early 2018, the debt rose with fluctuations, peaking around $4.67 billion in mid-2022 before slightly declining toward the end of the observed period. The data indicates notable increments at several points, particularly from late 2019 through 2020, suggesting active leveraging or financing activities during these times.
- Shareholders’ Equity (Deficit)
- Shareholders’ equity showed considerable volatility over the analyzed quarters. Beginning with a positive equity near $424 million in early 2018, it experienced fluctuations—rising and falling sharply—with intermittent shifts into negative territory from early 2021 onwards. Notably, from March 2021, equity moved significantly into deficit, reaching beyond negative $1.2 billion by late 2022. This shift signifies increasing liabilities relative to assets or accumulated losses, indicating financial strain or aggressive capital structure changes.
- Debt to Equity Ratio
- The debt to equity ratio presented extreme variability, reflecting the fluctuations in both debt and equity. Ratios were already elevated at 7.53 in early 2018 but spiked extraordinarily at certain points, notably hitting over 41 times in early 2020. This exceptionally high ratio corresponds with the significant decline or negative equity observed during some periods, indicating heavy reliance on debt financing relative to shareholders’ equity. The ratio’s spikes and troughs reflect ongoing volatility in the company's financial leverage and capital structure stability throughout the period.
- Overall Analysis
- The financial data reveal a company increasingly reliant on debt, with a rising total debt burden coupled with declining or negative equity balances in later quarters. The sharp reduction and eventual negative shareholders’ equity suggest challenges in profitability, retention of earnings, or asset valuation. The resulting high and fluctuating debt to equity ratios highlight an aggressive debt usage strategy and potential exposure to financial risk. These trends warrant cautious monitoring of the company’s capital structure and solvency metrics.
Debt to Equity (including Operating Lease Liability)
O’Reilly Automotive Inc., debt to equity (including operating lease liability) calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current portion of long-term debt | —) | —) | —) | —) | —) | —) | 299,880) | —) | 499,783) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, less current portion | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 3,824,288) | 4,123,217) | 4,122,424) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total debt | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 4,124,168) | 4,123,217) | 4,622,207) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Current portion of operating lease liabilities | 360,529) | 341,705) | 334,884) | 337,832) | 336,962) | 333,624) | 329,334) | 322,778) | 318,533) | 318,601) | 316,932) | 316,061) | 308,726) | 304,034) | 296,605) | —) | —) | —) | —) | ||||||
| Operating lease liabilities, less current portion | 1,809,241) | 1,683,216) | 1,698,787) | 1,701,757) | 1,729,013) | 1,747,267) | 1,761,732) | 1,718,691) | 1,640,646) | 1,652,284) | 1,661,991) | 1,655,297) | 1,642,178) | 1,631,719) | 1,629,311) | —) | —) | —) | —) | ||||||
| Total debt (including operating lease liability) | 6,540,542) | 6,694,754) | 5,861,562) | 5,866,567) | 5,892,048) | 5,906,068) | 6,215,234) | 6,164,686) | 6,581,386) | 6,098,282) | 6,450,171) | 5,861,885) | 5,654,532) | 5,719,491) | 5,386,837) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Shareholders’ equity (deficit) | (1,205,463) | (1,107,430) | (328,273) | (66,423) | (140,853) | 217,694) | (6,977) | 140,258) | 709,225) | 589,100) | 108,844) | 397,340) | 166,219) | 144,682) | 372,365) | 353,667) | 498,379) | 384,990) | 423,828) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Debt to equity (including operating lease liability)1 | — | — | — | — | — | 27.13 | — | 43.95 | 9.28 | 10.35 | 59.26 | 14.75 | 34.02 | 39.53 | 14.47 | 9.66 | 6.37 | 8.45 | 7.53 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 1.05 | 1.08 | 0.97 | 0.96 | 1.07 | 1.07 | 0.98 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 43.73 | 20.47 | 23.99 | 13.16 | 26.74 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lowe’s Cos. Inc. | — | — | 62.29 | 18.24 | 6.44 | 6.01 | 15.28 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| TJX Cos. Inc. | 1.99 | 2.01 | 2.42 | 2.66 | 2.81 | 3.36 | 3.48 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Shareholders’ equity (deficit)
= 6,540,542 ÷ -1,205,463 = —
2 Click competitor name to see calculations.
- Total Debt (Including Operating Lease Liability)
- The total debt shows a generally increasing trend over the periods from March 2018 to September 2022. Beginning slightly above $3.19 billion in early 2018, the debt rose notably in the first quarter of 2019 to over $5.38 billion and remained elevated through 2022, reaching peaks above $6.6 billion in mid-2022. There is evidence of some fluctuations, but the overall direction indicates expansion in the company's liabilities over these years.
- Shareholders’ Equity (Deficit)
- Shareholders’ equity demonstrates significant volatility and fluctuation throughout the periods. Early measurements in 2018 show positive equity values around $424 million, with notable rises and declines thereafter. From 2019 onwards, the equity figures display higher variation, including positive peaks around $709 million in late 2020 and negative values starting in early 2021, culminating in substantial deficits exceeding negative $1.2 billion by mid to late 2022. This trend points to increasing equity erosion and financial strain over time.
- Debt to Equity Ratio (Including Operating Lease Liability)
- The debt to equity ratio exhibits extreme variability and high leverage levels across the reported periods. Starting at 7.53 in early 2018, it climbs to highs such as 59.26 in March 2020, indicating very high debt relative to equity. Some quarters show dramatic shifts—for example, the ratio jumps from 14.75 in late 2019 to nearly 60 in early 2020, then fluctuates with further peaks around 44 in late 2020 and 27 in mid-2021. The high and unstable leverage suggests considerable financial risk and possible challenges in maintaining capital structure stability.
- Overall Financial Analysis
- The data reflects a company increasing its debt levels substantially over time while simultaneously experiencing significant erosion in shareholders' equity, ultimately resulting in sizable equity deficits. The rising debt coupled with deteriorating equity leads to exceedingly high and unstable leverage ratios. These patterns indicate escalating financial risk, potential solvency concerns, and an increased reliance on debt financing. The volatility in equity and leverage suggests that the company's capital structure and financial health have faced considerable pressures and may warrant further strategic financial management and risk mitigation efforts.
Debt to Capital
O’Reilly Automotive Inc., debt to capital calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current portion of long-term debt | —) | —) | —) | —) | —) | —) | 299,880) | —) | 499,783) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, less current portion | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 3,824,288) | 4,123,217) | 4,122,424) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total debt | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 4,124,168) | 4,123,217) | 4,622,207) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Shareholders’ equity (deficit) | (1,205,463) | (1,107,430) | (328,273) | (66,423) | (140,853) | 217,694) | (6,977) | 140,258) | 709,225) | 589,100) | 108,844) | 397,340) | 166,219) | 144,682) | 372,365) | 353,667) | 498,379) | 384,990) | 423,828) | ||||||
| Total capital | 3,165,309) | 3,562,403) | 3,499,618) | 3,760,555) | 3,685,220) | 4,042,871) | 4,117,191) | 4,263,475) | 5,331,432) | 4,716,497) | 4,580,092) | 4,287,867) | 3,869,847) | 3,928,420) | 3,833,286) | 3,770,789) | 3,672,706) | 3,638,528) | 3,616,894) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Debt to capital1 | 1.38 | 1.31 | 1.09 | 1.02 | 1.04 | 0.95 | 1.00 | 0.97 | 0.87 | 0.88 | 0.98 | 0.91 | 0.96 | 0.96 | 0.90 | 0.91 | 0.86 | 0.89 | 0.88 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Debt to Capital, Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 0.37 | 0.38 | 0.35 | 0.35 | 0.39 | 0.40 | 0.37 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 0.97 | 0.95 | 0.95 | 0.92 | 0.96 | 1.01 | 1.11 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lowe’s Cos. Inc. | 1.06 | 1.01 | 0.98 | 0.94 | 0.84 | 0.83 | 0.93 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| TJX Cos. Inc. | 0.34 | 0.34 | 0.46 | 0.51 | 0.53 | 0.57 | 0.60 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Debt to capital = Total debt ÷ Total capital
= 4,370,772 ÷ 3,165,309 = 1.38
2 Click competitor name to see calculations.
The financial data reveals several notable trends regarding the debt structure and capital composition over the observed periods. Total debt exhibits an overall increasing trajectory from early 2018 through late 2022, albeit with fluctuations in certain quarters. Beginning at approximately $3.19 billion in March 2018, total debt rises steadily to reach a peak past $4.6 billion in June 2022 before slightly declining toward the subsequent quarter.
Total capital similarly shows an upward trend in the earlier years but demonstrates more volatility in the later periods. After a general increase from around $3.6 billion in early 2018 to a peak exceeding $5.3 billion in September 2020, total capital declines notably by the end of the dataset, dropping to near $3.2 billion in September 2022.
The debt to capital ratio manifests significant variation and a discernible increase over time, pointing to a shifting balance between debt and capital financing. Initially, the ratio hovers below 1.0, indicating that total capital exceeds total debt. However, from late 2018 onward, the ratio fluctuates near and eventually above 1.0. By the end of the available data, the ratio surges to approximately 1.38, suggesting that total debt has grown to substantially exceed total capital.
- Total Debt Trends
- Steady growth across nearly all quarters, with total debt rising from roughly $3.2 billion to above $4.3 billion over the observed period, peaking in mid-2022.
- Total Capital Trends
- Early moderate increases followed by volatility, culminating in a peak above $5.3 billion in late 2020, then declining sharply to around $3.2 billion by late 2022.
- Debt to Capital Ratio
- A rising trend from below 1.0 to values exceeding 1.3, reflecting increasing reliance on debt relative to capital and a potential shift in the company’s financial leverage and risk profile.
These financial indicators together suggest a growing emphasis on debt financing over the analyzed timeframe, especially pronounced after 2020. The declining total capital alongside increasing debt levels points to a potential strategic shift or changes in the company's capital structure management. The elevated debt to capital ratio toward the end of the period raises considerations regarding financial risk and sustainability of leverage levels.
Debt to Capital (including Operating Lease Liability)
O’Reilly Automotive Inc., debt to capital (including operating lease liability) calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current portion of long-term debt | —) | —) | —) | —) | —) | —) | 299,880) | —) | 499,783) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, less current portion | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 3,824,288) | 4,123,217) | 4,122,424) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total debt | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 4,124,168) | 4,123,217) | 4,622,207) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Current portion of operating lease liabilities | 360,529) | 341,705) | 334,884) | 337,832) | 336,962) | 333,624) | 329,334) | 322,778) | 318,533) | 318,601) | 316,932) | 316,061) | 308,726) | 304,034) | 296,605) | —) | —) | —) | —) | ||||||
| Operating lease liabilities, less current portion | 1,809,241) | 1,683,216) | 1,698,787) | 1,701,757) | 1,729,013) | 1,747,267) | 1,761,732) | 1,718,691) | 1,640,646) | 1,652,284) | 1,661,991) | 1,655,297) | 1,642,178) | 1,631,719) | 1,629,311) | —) | —) | —) | —) | ||||||
| Total debt (including operating lease liability) | 6,540,542) | 6,694,754) | 5,861,562) | 5,866,567) | 5,892,048) | 5,906,068) | 6,215,234) | 6,164,686) | 6,581,386) | 6,098,282) | 6,450,171) | 5,861,885) | 5,654,532) | 5,719,491) | 5,386,837) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Shareholders’ equity (deficit) | (1,205,463) | (1,107,430) | (328,273) | (66,423) | (140,853) | 217,694) | (6,977) | 140,258) | 709,225) | 589,100) | 108,844) | 397,340) | 166,219) | 144,682) | 372,365) | 353,667) | 498,379) | 384,990) | 423,828) | ||||||
| Total capital (including operating lease liability) | 5,335,079) | 5,587,324) | 5,533,289) | 5,800,144) | 5,751,195) | 6,123,762) | 6,208,257) | 6,304,944) | 7,290,611) | 6,687,382) | 6,559,015) | 6,259,225) | 5,820,751) | 5,864,173) | 5,759,202) | 3,770,789) | 3,672,706) | 3,638,528) | 3,616,894) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Debt to capital (including operating lease liability)1 | 1.23 | 1.20 | 1.06 | 1.01 | 1.02 | 0.96 | 1.00 | 0.98 | 0.90 | 0.91 | 0.98 | 0.94 | 0.97 | 0.98 | 0.94 | 0.91 | 0.86 | 0.89 | 0.88 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 0.51 | 0.52 | 0.49 | 0.49 | 0.52 | 0.52 | 0.49 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 0.98 | 0.95 | 0.96 | 0.93 | 0.96 | 1.01 | 1.09 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lowe’s Cos. Inc. | 1.05 | 1.01 | 0.98 | 0.95 | 0.87 | 0.86 | 0.94 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| TJX Cos. Inc. | 0.67 | 0.67 | 0.71 | 0.73 | 0.74 | 0.77 | 0.78 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 6,540,542 ÷ 5,335,079 = 1.23
2 Click competitor name to see calculations.
- Total Debt Trend
- The total debt, inclusive of operating lease liabilities, exhibits an overall increasing trend from the first quarter of 2018 through the third quarter of 2022. Starting at approximately $3.19 billion in March 2018, the figure rises notably to about $6.54 billion by September 2022. There are fluctuations within this period; for example, debt levels increased from 2018 into early 2019, followed by a stabilization phase in late 2019 and early 2020. A significant rise is observed from 2021 onwards, with debt generally maintaining levels above $5.8 billion.
- Total Capital Trend
- Total capital, which also includes operating lease liabilities, shows a similar pattern to total debt but with less pronounced growth. Beginning at around $3.62 billion in March 2018, capital rises steadily to reach highs above $7.29 billion by the third quarter of 2020. However, from late 2020 onwards, total capital experiences a declining trajectory, decreasing from peak values to approximately $5.34 billion by the third quarter of 2022. This decline contrasts with the upward movement in debt during the same period.
- Debt to Capital Ratio Analysis
- The debt to capital ratio remains consistently high throughout the period, indicating a leverage-heavy capital structure. Initially, the ratio hovers around 0.86 to 0.91 in 2018, moving upwards to levels near or above 0.94 through 2019. Notably, from 2020 onward, the ratio frequently reaches or exceeds 1.00, signaling that total debt equals or surpasses total capital. This trend culminates in the highest ratios recorded at 1.20 and 1.23 in the last two quarters of the dataset. The increase reflects a relative rise in debt compared to capital, suggesting greater financial leverage and potentially higher financial risk over time.
- Overall Insights
- The data reveals a marked increase in leverage across the observed quarters. While both total debt and capital grew until around 2020, capital has since declined whereas debt has remained elevated. The rising debt to capital ratio above 1.00 in recent periods highlights an intensification of debt reliance. This trend may warrant scrutiny regarding the company's ability to manage obligations and maintain financial flexibility. The data underscores a shift towards higher indebtedness that could impact future financing costs and risk profiles.
Debt to Assets
O’Reilly Automotive Inc., debt to assets calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current portion of long-term debt | —) | —) | —) | —) | —) | —) | 299,880) | —) | 499,783) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, less current portion | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 3,824,288) | 4,123,217) | 4,122,424) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total debt | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 4,124,168) | 4,123,217) | 4,622,207) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total assets | 12,238,028) | 12,067,689) | 11,760,389) | 11,718,707) | 11,789,385) | 11,949,333) | 11,850,887) | 11,596,642) | 12,503,951) | 11,728,535) | 11,108,862) | 10,717,160) | 10,372,724) | 10,201,943) | 10,061,562) | 7,980,789) | 7,894,714) | 7,766,740) | 7,666,657) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Debt to assets1 | 0.36 | 0.39 | 0.33 | 0.33 | 0.32 | 0.32 | 0.35 | 0.36 | 0.37 | 0.35 | 0.40 | 0.36 | 0.36 | 0.37 | 0.34 | 0.43 | 0.40 | 0.42 | 0.42 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Debt to Assets, Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 0.19 | 0.19 | 0.17 | 0.18 | 0.20 | 0.21 | 0.19 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 0.54 | 0.51 | 0.49 | 0.53 | 0.53 | 0.55 | 0.61 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lowe’s Cos. Inc. | 0.53 | 0.49 | 0.45 | 0.47 | 0.43 | 0.42 | 0.48 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| TJX Cos. Inc. | 0.11 | 0.12 | 0.18 | 0.20 | 0.20 | 0.23 | 0.28 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Debt to assets = Total debt ÷ Total assets
= 4,370,772 ÷ 12,238,028 = 0.36
2 Click competitor name to see calculations.
- Total Debt
- The total debt exhibited fluctuations over the analyzed periods, initially increasing from approximately $3.19 billion at the end of Q1 2018 to a peak near $4.47 billion by Q1 2020. Subsequently, there was a noted decline towards the end of 2020, dipping to around $4.12 billion. Following that period, debt levels stabilized in the $3.8 to $4.1 billion range through 2021. However, a notable increase occurred in mid-2022, reaching about $4.67 billion before a slight reduction to approximately $4.37 billion by Q3 2022.
- Total Assets
- Total assets demonstrated a strong upward trend throughout the timeframe. Starting from roughly $7.67 billion at Q1 2018, assets grew steadily to surpass $10 billion by early 2019 and continued rising to peak at about $12.5 billion in Q3 2020. Post that peak there was a minor decrease and fluctuations, with assets generally remaining in the $11.5 to $12.2 billion range across 2021 and early 2022. By Q3 2022, assets reached their highest level near $12.24 billion, indicative of overall growth in the company's asset base.
- Debt to Assets Ratio
- The debt to assets ratio experienced variation that reflected the trends in both debt and asset values. Initially, the ratio hovered around 0.40 to 0.43 in 2018, indicating debt was slightly less than half of total assets. In 2019, the ratio declined notably to approximately 0.34 to 0.37, reflecting asset growth outpacing debt accumulation. The ratio then fluctuated between 0.32 and 0.39 through 2020 to 2022, with a general pattern of modest decreases followed by rises. By Q3 2022, the ratio settled around 0.36, suggesting a somewhat improved leverage position relative to total assets compared to earlier periods.
- General Insights
- The data indicates a consistent expansion in the asset base, suggesting ongoing investments or growth in company holdings. Debt levels, while generally growing over the longer term, showed periods of reduction and stabilization, which may signify active debt management efforts. The debt to asset ratio's fluctuations show that asset growth often outpaced debt increases, maintaining leverage at manageable levels. The peak in total debt during early 2020 followed by a reduction and later increase in 2022 could reflect strategic financing decisions in response to economic conditions. Overall, the company's financial structure shows balanced asset growth with controlled leverage over the observed periods.
Debt to Assets (including Operating Lease Liability)
O’Reilly Automotive Inc., debt to assets (including operating lease liability) calculation (quarterly data)
| Sep 30, 2022 | 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current portion of long-term debt | —) | —) | —) | —) | —) | —) | 299,880) | —) | 499,783) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, less current portion | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 3,824,288) | 4,123,217) | 4,122,424) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total debt | 4,370,772) | 4,669,833) | 3,827,891) | 3,826,978) | 3,826,073) | 3,825,177) | 4,124,168) | 4,123,217) | 4,622,207) | 4,127,397) | 4,471,248) | 3,890,527) | 3,703,628) | 3,783,738) | 3,460,921) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Current portion of operating lease liabilities | 360,529) | 341,705) | 334,884) | 337,832) | 336,962) | 333,624) | 329,334) | 322,778) | 318,533) | 318,601) | 316,932) | 316,061) | 308,726) | 304,034) | 296,605) | —) | —) | —) | —) | ||||||
| Operating lease liabilities, less current portion | 1,809,241) | 1,683,216) | 1,698,787) | 1,701,757) | 1,729,013) | 1,747,267) | 1,761,732) | 1,718,691) | 1,640,646) | 1,652,284) | 1,661,991) | 1,655,297) | 1,642,178) | 1,631,719) | 1,629,311) | —) | —) | —) | —) | ||||||
| Total debt (including operating lease liability) | 6,540,542) | 6,694,754) | 5,861,562) | 5,866,567) | 5,892,048) | 5,906,068) | 6,215,234) | 6,164,686) | 6,581,386) | 6,098,282) | 6,450,171) | 5,861,885) | 5,654,532) | 5,719,491) | 5,386,837) | 3,417,122) | 3,174,327) | 3,253,538) | 3,193,066) | ||||||
| Total assets | 12,238,028) | 12,067,689) | 11,760,389) | 11,718,707) | 11,789,385) | 11,949,333) | 11,850,887) | 11,596,642) | 12,503,951) | 11,728,535) | 11,108,862) | 10,717,160) | 10,372,724) | 10,201,943) | 10,061,562) | 7,980,789) | 7,894,714) | 7,766,740) | 7,666,657) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Debt to assets (including operating lease liability)1 | 0.53 | 0.55 | 0.50 | 0.50 | 0.50 | 0.49 | 0.52 | 0.53 | 0.53 | 0.52 | 0.58 | 0.55 | 0.55 | 0.56 | 0.54 | 0.43 | 0.40 | 0.42 | 0.42 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 0.34 | 0.34 | 0.32 | 0.31 | 0.34 | 0.34 | 0.31 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 0.62 | 0.60 | 0.58 | 0.62 | 0.61 | 0.64 | 0.71 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lowe’s Cos. Inc. | 0.63 | 0.58 | 0.54 | 0.56 | 0.52 | 0.51 | 0.57 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| TJX Cos. Inc. | 0.43 | 0.45 | 0.49 | 0.50 | 0.50 | 0.59 | 0.65 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 6,540,542 ÷ 12,238,028 = 0.53
2 Click competitor name to see calculations.
- Total Debt (Including Operating Lease Liability)
-
The total debt showed a general upward trend from March 2018 through September 2022. Starting at approximately $3.19 billion in March 2018, debt levels increased significantly in early 2019, almost doubling by March 2019 to around $5.39 billion. This elevated debt level was maintained with slight fluctuations through 2019 and 2020. Peak debt was observed in June 2022, reaching about $6.69 billion, followed by a modest decline to approximately $6.54 billion in September 2022. The period reflects increasing leverage, with notable debt expansion primarily occurring between early 2018 and mid-2019, and again trending upward from 2021 onward.
- Total Assets
-
Total assets consistently increased over the analyzed period, moving from roughly $7.67 billion in March 2018 to $12.24 billion in September 2022. The asset base expanded steadily each quarter with occasional accelerations, notably between mid-2019 and late 2020, and again in 2022. This growth in assets indicates ongoing investment and asset accumulation, supporting business expansion or operational scaling during the period under review.
- Debt to Assets Ratio (Including Operating Lease Liability)
-
The debt to assets ratio exhibited variability but remained within a narrow range over the examined quarters. Initially, the ratio hovered around 0.40 to 0.43 in 2018, before rising sharply to between 0.54 and 0.56 in 2019, reflecting a relative increase in debt compared to assets. From 2020 to early 2021, there was a modest decline in the ratio to about 0.49 to 0.53, indicating a slight reduction in leverage relative to the asset base. However, in 2022, the ratio climbed again to reach a value around 0.55 in mid-year before slightly decreasing toward the third quarter. This pattern suggests that while assets grew steadily, increases in debt levels occasionally outpaced asset growth, contributing to fluctuations in financial leverage.
Financial Leverage
O’Reilly Automotive Inc., financial leverage calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Total assets | 12,238,028) | 12,067,689) | 11,760,389) | 11,718,707) | 11,789,385) | 11,949,333) | 11,850,887) | 11,596,642) | 12,503,951) | 11,728,535) | 11,108,862) | 10,717,160) | 10,372,724) | 10,201,943) | 10,061,562) | 7,980,789) | 7,894,714) | 7,766,740) | 7,666,657) | ||||||
| Shareholders’ equity (deficit) | (1,205,463) | (1,107,430) | (328,273) | (66,423) | (140,853) | 217,694) | (6,977) | 140,258) | 709,225) | 589,100) | 108,844) | 397,340) | 166,219) | 144,682) | 372,365) | 353,667) | 498,379) | 384,990) | 423,828) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Financial leverage1 | — | — | — | — | — | 54.89 | — | 82.68 | 17.63 | 19.91 | 102.06 | 26.97 | 62.40 | 70.51 | 27.02 | 22.57 | 15.84 | 20.17 | 18.09 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Financial Leverage, Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 3.12 | 3.19 | 3.07 | 3.04 | 3.17 | 3.14 | 3.13 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 70.56 | 34.20 | 41.51 | 21.39 | 43.60 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Lowe’s Cos. Inc. | — | — | 115.06 | 32.52 | 12.49 | 11.88 | 26.71 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| TJX Cos. Inc. | 4.67 | 4.49 | 4.94 | 5.28 | 5.67 | 5.70 | 5.36 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Financial leverage = Total assets ÷ Shareholders’ equity (deficit)
= 12,238,028 ÷ -1,205,463 = —
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals notable fluctuations in the key financial indicators over the observed periods. The total assets have generally exhibited an increasing trend from the beginning of 2018 through to late 2022, with a few periods where the growth rate slowed or slightly reversed. Starting at approximately 7.67 billion US dollars in the first quarter of 2018, total assets increased steadily to about 12.24 billion US dollars by the third quarter of 2022, indicating ongoing asset accumulation over the timeframe.
Shareholders’ equity, however, has shown considerable volatility and a tendency to fluctuate significantly over the same period. It began at roughly 424 million US dollars in early 2018 and experienced sharp decreases and recoveries intermittently. By the third quarter of 2022, shareholders’ equity had moved into a negative position, around -1.21 billion US dollars, suggesting challenges in maintaining equity value relative to total assets. This negative equity position raises concerns about the company’s financial structure and potential solvency risks in later periods.
Financial leverage ratios, which measure the extent of debt relative to equity, have mirrored these fluctuations and are indicative of increased reliance on debt financing at certain points. The ratio varied widely, starting at approximately 18 in early 2018, spiking to values above 70 around mid-2019, dropping, and then reaching extreme highs of over 100 in early 2020 and again around 82 by the end of 2020. The absence of some data points in financial leverage after 2020 limits comprehensive trend analysis for later periods, but the recorded values imply periods of elevated financial risk and aggressive leveraging strategies.
Overall, the data portrays a company with steadily growing asset bases but marked by instability in equity levels and significant fluctuations in financial leverage. These patterns suggest shifts between equity and debt financing, with increased leverage potentially heightening financial risk. The negative shareholders’ equity in recent quarters is particularly notable and would warrant further investigation to understand underlying causes and potential impacts on financial stability.
Interest Coverage
O’Reilly Automotive Inc., interest coverage calculation (quarterly data)
| Sep 30, 2022 | 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Net income | 585,438) | 576,760) | 481,880) | 518,973) | 558,652) | 585,451) | 501,609) | 392,945) | 527,252) | 531,667) | 300,438) | 324,916) | 391,293) | 353,681) | 321,152) | 300,357) | 366,151) | 353,073) | 304,906) | ||||||
| Add: Income tax expense | 176,411) | 180,538) | 151,381) | 125,251) | 161,877) | 175,883) | 154,218) | 106,984) | 159,154) | 168,743) | 79,222) | 84,397) | 110,600) | 111,290) | 93,000) | 92,800) | 89,500) | 96,800) | 90,500) | ||||||
| Add: Interest expense | 43,164) | 37,384) | 34,841) | 34,732) | 34,873) | 37,657) | 37,506) | 38,349) | 41,668) | 41,723) | 39,386) | 35,288) | 35,858) | 34,538) | 34,291) | 31,468) | 31,582) | 30,862) | 28,217) | ||||||
| Earnings before interest and tax (EBIT) | 805,013) | 794,682) | 668,102) | 678,956) | 755,402) | 798,991) | 693,333) | 538,278) | 728,074) | 742,133) | 419,046) | 444,601) | 537,751) | 499,509) | 448,443) | 424,625) | 487,233) | 480,735) | 423,623) | ||||||
| Solvency Ratio | |||||||||||||||||||||||||
| Interest coverage1 | 19.63 | 20.43 | 20.42 | 20.22 | 18.78 | 17.78 | 16.97 | 15.07 | 14.77 | 14.08 | 13.10 | 13.79 | 14.03 | 14.10 | 14.36 | 14.87 | 15.28 | 16.08 | 17.45 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Interest Coverage, Competitors2 | |||||||||||||||||||||||||
| Amazon.com Inc. | 5.61 | 6.57 | 13.02 | 22.09 | 18.81 | 21.05 | 19.96 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Home Depot Inc. | 16.63 | 15.94 | 15.29 | 13.60 | 13.38 | 13.08 | 12.61 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Interest coverage
= (EBITQ3 2022
+ EBITQ2 2022
+ EBITQ1 2022
+ EBITQ4 2021)
÷ (Interest expenseQ3 2022
+ Interest expenseQ2 2022
+ Interest expenseQ1 2022
+ Interest expenseQ4 2021)
= (805,013 + 794,682 + 668,102 + 678,956)
÷ (43,164 + 37,384 + 34,841 + 34,732)
= 19.63
2 Click competitor name to see calculations.
- Earnings before interest and tax (EBIT)
- The EBIT values exhibit fluctuation over the analyzed periods, with a noticeable pattern of quarterly variance. Starting at approximately 424 million USD in the first quarter of 2018, EBIT generally increased through 2018 and 2019 but saw declines during certain quarters, notably in the final quarters of 2018 and 2019. A significant increase is observed in the middle of 2020, surpassing 700 million USD, followed by some decreases at the end of 2020 and early 2021. Towards the most recent quarters, EBIT values display a rising trend again, reaching peaks above 790 million USD, indicating improved operational profitability over time despite intermittent declines.
- Interest Expense
- Interest expense demonstrates a gradual upward trend across the periods. Starting near 28 million USD in early 2018, it steadily rises over the years, reaching above 43 million USD by the third quarter of 2022. The increase tends to be consistent with the growth in the company’s financing costs or debt levels, although the pace of increase varies slightly among quarters. The expense exhibits less volatility relative to EBIT, indicating steady interest obligations without abrupt changes.
- Interest Coverage Ratio
- This ratio, indicating the company's ability to meet interest obligations from operating earnings, shows an initial declining trend from approximately 17.45 in early 2018 to around 13.1 by the first quarter of 2020. This decline aligns with periods where EBIT decreased while interest expense increased. From mid-2020 onward, the interest coverage ratio improves substantially, reaching a value above 20 by mid-2021 and maintaining levels around 19 to 20 through 2022. This improvement reflects enhanced earnings relative to interest costs, suggesting strengthened financial stability and capacity to service debt in the more recent periods.