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)
Walgreens Boots Alliance Inc., solvency ratios
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Walgreens Boots Alliance Inc. debt to equity ratio deteriorated from 2017 to 2018 and from 2018 to 2019. |
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | Walgreens Boots Alliance Inc. debt to capital ratio deteriorated from 2017 to 2018 and from 2018 to 2019. |
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | Walgreens Boots Alliance Inc. debt to assets ratio deteriorated from 2017 to 2018 and from 2018 to 2019. |
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Walgreens Boots Alliance Inc. financial leverage ratio increased from 2017 to 2018 and from 2018 to 2019. |
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | Walgreens Boots Alliance Inc. interest coverage ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019. |
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | Walgreens Boots Alliance Inc. fixed charge coverage ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019. |
Debt to Equity
Walgreens Boots Alliance Inc., debt to equity calculation, comparison to benchmarks
| Aug 31, 2019 | Aug 31, 2018 | Aug 31, 2017 | Aug 31, 2016 | Aug 31, 2015 | Aug 31, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Short-term debt | 5,738) | 1,966) | 251) | 323) | 1,068) | 774) | |
| Long-term debt | 11,098) | 12,431) | 12,684) | 18,705) | 13,315) | 3,736) | |
| Total debt | 16,836) | 14,397) | 12,935) | 19,028) | 14,383) | 4,510) | |
| Total Walgreens Boots Alliance, Inc. shareholders’ equity | 23,512) | 26,007) | 27,466) | 29,880) | 30,861) | 20,457) | |
| Solvency Ratio | |||||||
| Debt to equity1 | 0.72 | 0.55 | 0.47 | 0.64 | 0.47 | 0.22 | |
| Benchmarks | |||||||
| Debt to Equity, Competitors2 | |||||||
| Costco Wholesale Corp. | 0.48 | 0.54 | — | — | — | — | |
| Target Corp. | 1.00 | — | — | — | — | — | |
| Walmart Inc. | 0.80 | — | — | — | — | — | |
| Debt to Equity, Sector | |||||||
| Consumer Staples Distribution & Retail | 0.77 | — | — | — | — | — | |
| Debt to Equity, Industry | |||||||
| Consumer Staples | 1.07 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
1 2019 Calculation
Debt to equity = Total debt ÷ Total Walgreens Boots Alliance, Inc. shareholders’ equity
= 16,836 ÷ 23,512 = 0.72
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Walgreens Boots Alliance Inc. debt to equity ratio deteriorated from 2017 to 2018 and from 2018 to 2019. |
Debt to Capital
Walgreens Boots Alliance Inc., debt to capital calculation, comparison to benchmarks
| Aug 31, 2019 | Aug 31, 2018 | Aug 31, 2017 | Aug 31, 2016 | Aug 31, 2015 | Aug 31, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Short-term debt | 5,738) | 1,966) | 251) | 323) | 1,068) | 774) | |
| Long-term debt | 11,098) | 12,431) | 12,684) | 18,705) | 13,315) | 3,736) | |
| Total debt | 16,836) | 14,397) | 12,935) | 19,028) | 14,383) | 4,510) | |
| Total Walgreens Boots Alliance, Inc. shareholders’ equity | 23,512) | 26,007) | 27,466) | 29,880) | 30,861) | 20,457) | |
| Total capital | 40,348) | 40,404) | 40,401) | 48,908) | 45,244) | 24,967) | |
| Solvency Ratio | |||||||
| Debt to capital1 | 0.42 | 0.36 | 0.32 | 0.39 | 0.32 | 0.18 | |
| Benchmarks | |||||||
| Debt to Capital, Competitors2 | |||||||
| Costco Wholesale Corp. | 0.32 | 0.35 | — | — | — | — | |
| Target Corp. | 0.50 | — | — | — | — | — | |
| Walmart Inc. | 0.44 | — | — | — | — | — | |
| Debt to Capital, Sector | |||||||
| Consumer Staples Distribution & Retail | 0.44 | — | — | — | — | — | |
| Debt to Capital, Industry | |||||||
| Consumer Staples | 0.52 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
1 2019 Calculation
Debt to capital = Total debt ÷ Total capital
= 16,836 ÷ 40,348 = 0.42
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. | Walgreens Boots Alliance Inc. debt to capital ratio deteriorated from 2017 to 2018 and from 2018 to 2019. |
Debt to Assets
Walgreens Boots Alliance Inc., debt to assets calculation, comparison to benchmarks
| Aug 31, 2019 | Aug 31, 2018 | Aug 31, 2017 | Aug 31, 2016 | Aug 31, 2015 | Aug 31, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Short-term debt | 5,738) | 1,966) | 251) | 323) | 1,068) | 774) | |
| Long-term debt | 11,098) | 12,431) | 12,684) | 18,705) | 13,315) | 3,736) | |
| Total debt | 16,836) | 14,397) | 12,935) | 19,028) | 14,383) | 4,510) | |
| Total assets | 67,598) | 68,124) | 66,009) | 72,688) | 68,782) | 37,182) | |
| Solvency Ratio | |||||||
| Debt to assets1 | 0.25 | 0.21 | 0.20 | 0.26 | 0.21 | 0.12 | |
| Benchmarks | |||||||
| Debt to Assets, Competitors2 | |||||||
| Costco Wholesale Corp. | 0.16 | 0.17 | — | — | — | — | |
| Target Corp. | 0.27 | — | — | — | — | — | |
| Walmart Inc. | 0.26 | — | — | — | — | — | |
| Debt to Assets, Sector | |||||||
| Consumer Staples Distribution & Retail | 0.25 | — | — | — | — | — | |
| Debt to Assets, Industry | |||||||
| Consumer Staples | 0.33 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
1 2019 Calculation
Debt to assets = Total debt ÷ Total assets
= 16,836 ÷ 67,598 = 0.25
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. | Walgreens Boots Alliance Inc. debt to assets ratio deteriorated from 2017 to 2018 and from 2018 to 2019. |
Financial Leverage
Walgreens Boots Alliance Inc., financial leverage calculation, comparison to benchmarks
| Aug 31, 2019 | Aug 31, 2018 | Aug 31, 2017 | Aug 31, 2016 | Aug 31, 2015 | Aug 31, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Total assets | 67,598) | 68,124) | 66,009) | 72,688) | 68,782) | 37,182) | |
| Total Walgreens Boots Alliance, Inc. shareholders’ equity | 23,512) | 26,007) | 27,466) | 29,880) | 30,861) | 20,457) | |
| Solvency Ratio | |||||||
| Financial leverage1 | 2.88 | 2.62 | 2.40 | 2.43 | 2.23 | 1.82 | |
| Benchmarks | |||||||
| Financial Leverage, Competitors2 | |||||||
| Costco Wholesale Corp. | 2.98 | 3.19 | — | — | — | — | |
| Target Corp. | 3.65 | — | — | — | — | — | |
| Walmart Inc. | 3.02 | — | — | — | — | — | |
| Financial Leverage, Sector | |||||||
| Consumer Staples Distribution & Retail | 3.09 | — | — | — | — | — | |
| Financial Leverage, Industry | |||||||
| Consumer Staples | 3.28 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
1 2019 Calculation
Financial leverage = Total assets ÷ Total Walgreens Boots Alliance, Inc. shareholders’ equity
= 67,598 ÷ 23,512 = 2.88
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Walgreens Boots Alliance Inc. financial leverage ratio increased from 2017 to 2018 and from 2018 to 2019. |
Interest Coverage
Walgreens Boots Alliance Inc., interest coverage calculation, comparison to benchmarks
| Aug 31, 2019 | Aug 31, 2018 | Aug 31, 2017 | Aug 31, 2016 | Aug 31, 2015 | Aug 31, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Net earnings attributable to Walgreens Boots Alliance, Inc. | 3,982) | 5,024) | 4,078) | 4,173) | 4,220) | 1,932) | |
| Add: Net income attributable to noncontrolling interest | (20) | 7) | 23) | 18) | 59) | 99) | |
| Add: Income tax expense | 588) | 998) | 760) | 997) | 1,056) | 1,526) | |
| Add: Interest expense, net | 704) | 616) | 693) | 596) | 605) | 156) | |
| Earnings before interest and tax (EBIT) | 5,254) | 6,645) | 5,554) | 5,784) | 5,940) | 3,713) | |
| Solvency Ratio | |||||||
| Interest coverage1 | 7.46 | 10.79 | 8.01 | 9.70 | 9.82 | 23.80 | |
| Benchmarks | |||||||
| Interest Coverage, Competitors2 | |||||||
| Costco Wholesale Corp. | 32.77 | 28.94 | — | — | — | — | |
| Target Corp. | 8.97 | — | — | — | — | — | |
| Walmart Inc. | 5.88 | — | — | — | — | — | |
| Interest Coverage, Sector | |||||||
| Consumer Staples Distribution & Retail | 7.73 | — | — | — | — | — | |
| Interest Coverage, Industry | |||||||
| Consumer Staples | 7.90 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
1 2019 Calculation
Interest coverage = EBIT ÷ Interest expense
= 5,254 ÷ 704 = 7.46
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. | Walgreens Boots Alliance Inc. interest coverage ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019. |
Fixed Charge Coverage
Walgreens Boots Alliance Inc., fixed charge coverage calculation, comparison to benchmarks
| Aug 31, 2019 | Aug 31, 2018 | Aug 31, 2017 | Aug 31, 2016 | Aug 31, 2015 | Aug 31, 2014 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Net earnings attributable to Walgreens Boots Alliance, Inc. | 3,982) | 5,024) | 4,078) | 4,173) | 4,220) | 1,932) | |
| Add: Net income attributable to noncontrolling interest | (20) | 7) | 23) | 18) | 59) | 99) | |
| Add: Income tax expense | 588) | 998) | 760) | 997) | 1,056) | 1,526) | |
| Add: Interest expense, net | 704) | 616) | 693) | 596) | 605) | 156) | |
| Earnings before interest and tax (EBIT) | 5,254) | 6,645) | 5,554) | 5,784) | 5,940) | 3,713) | |
| Add: Rental expense | 3,622) | 3,447) | 3,259) | 3,355) | 3,176) | 2,687) | |
| Earnings before fixed charges and tax | 8,876) | 10,092) | 8,813) | 9,139) | 9,116) | 6,400) | |
| Interest expense, net | 704) | 616) | 693) | 596) | 605) | 156) | |
| Rental expense | 3,622) | 3,447) | 3,259) | 3,355) | 3,176) | 2,687) | |
| Fixed charges | 4,326) | 4,063) | 3,952) | 3,951) | 3,781) | 2,843) | |
| Solvency Ratio | |||||||
| Fixed charge coverage1 | 2.05 | 2.48 | 2.23 | 2.31 | 2.41 | 2.25 | |
| Benchmarks | |||||||
| Fixed Charge Coverage, Competitors2 | |||||||
| Costco Wholesale Corp. | 12.40 | 11.48 | — | — | — | — | |
| Target Corp. | 6.16 | — | — | — | — | — | |
| Walmart Inc. | 3.14 | — | — | — | — | — | |
| Fixed Charge Coverage, Sector | |||||||
| Consumer Staples Distribution & Retail | 4.07 | — | — | — | — | — | |
| Fixed Charge Coverage, Industry | |||||||
| Consumer Staples | 5.01 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-31), 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31).
1 2019 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 8,876 ÷ 4,326 = 2.05
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. | Walgreens Boots Alliance Inc. fixed charge coverage ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019. |