Coca-Cola Co. (NYSE:KO)

Debt to Equity

The debt to equity ratio demonstrates an overall downward trend from March 2020 through December 2021, decreasing from 2.78 to 1.86. This trend suggests a reduction in financial leverage relative to shareholder equity during this period. From early 2022 onwards, the ratio oscillates mildly, generally staying below 1.8, with slight increases and decreases, ending at 1.73 in June 2025. This indicates a relative stabilization in the company’s capital structure with a moderate level of debt compared to equity.

Debt to Capital

The debt to capital ratio follows a similar pattern to debt to equity but with less volatility. Starting at 0.74 in March 2020, it declines steadily to around 0.60–0.65 range through 2025, indicating a moderate decrease in the proportion of debt used to finance the company’s capital over time. Small fluctuations occur throughout the periods, but the overall trend is towards a slightly reduced reliance on debt financing relative to the total capital.

Debt to Assets

This ratio gradually decreases from 0.54 in early 2020 to about 0.41–0.44 in most quarters from 2021 through 2024, reflecting a modest reduction in the level of debt relative to total assets. There is a slight uptick observed in the final reported quarters of 2024 and mid-2025 (around 0.47–0.48), suggesting a minor increase in leverage on the asset side during this time. Overall, the company manages to maintain a consistent debt level relative to asset base over the years.

Financial Leverage

The financial leverage ratio trends downward from 5.18 in March 2020 to a low point of approximately 3.65 in June 2025. This steady decline indicates progressively reduced use of debt or other liabilities in the company’s capital structure, reflecting a strengthening of the equity base or decrease in liabilities relative to equity. Moderate fluctuations occur, but the general trajectory is a lowering of leverage, implying improved financial stability.

Interest Coverage

The earliest data for interest coverage starts only in the fourth quarter of 2020 at 7.78 and shows a steady increase, peaking significantly at 17.35 in December 2022. Following the peak, the ratio declines gradually but remains strong, fluctuating between approximately 8.79 and 12.46 through mid-2025. This trend signifies an improving ability to service interest expenses over time, reaching a high point in 2022 and maintaining robust coverage afterwards, which reflects healthy operational earnings relative to interest obligations.

Total Debt

The total debt experienced fluctuations over the analyzed periods. Initially, it rose from 50,393 million USD in March 2020, peaking at 52,867 million USD in September 2020, before notably declining to 39,149 million USD by December 2022. Following this trough, debt figures exhibited a general upward trend, climbing to 49,446 million USD by June 2025. This pattern suggests a period of debt reduction between late 2020 and late 2022, followed by renewed borrowing or other debt increases through 2025.

Equity Attributable to Shareowners

Equity attributable to shareowners showed a steady increase over the observed quarters. Starting at 18,158 million USD in March 2020, it trended upward with minor fluctuations, reaching 28,585 million USD by June 2025. Notably, some quarters exhibited small declines, such as between April 2022 and July 2022 and between December 2023 and March 2024. Overall, the equity growth reflects positive retained earnings or capital inflows during the period.

Debt to Equity Ratio

The debt to equity ratio presented a declining trend from a high of 2.99 in June 2020 down to a low of 1.53 in September 2023, indicating an improvement in the company’s leverage position during this interval. However, subsequent quarters show a gradual increase in the ratio, rising to 1.87 by June 2025. This trend corresponds closely with the movements in total debt and equity, reflecting periods of deleveraging followed by moderate increases in leverage.

The financial data reveals several important trends related to debt management and capital structure over the analyzed periods. Total debt exhibits fluctuations, initially increasing from approximately 50.4 billion US dollars in the first quarter of 2020 to a peak close to 52.9 billion by the third quarter of the same year. Subsequently, a notable reduction occurs by the end of 2020, with debt levels falling below 43 billion. Throughout 2021 and early 2022, total debt remains relatively stable around the 40 to 42 billion range, before a gradual decline to about 39 billion towards the end of 2022. However, from early 2023 onwards, debt levels show a gradual upward trajectory, reaching nearly 49.4 billion by the middle of 2025.

Total capital follows a broadly similar pattern but maintains a consistently higher base compared to total debt. Capital peaks several times, with an initial value near 68.6 billion in early 2020, growing slightly to approximately 71.5 billion by late 2020. Thereafter, a temporary dip occurs with capital dipping below 62.5 billion around the end of 2020 and early 2021. From mid-2021 onwards, total capital increases steadily, achieving approximately 78 billion by mid-2025, indicating incremental growth in the company’s capital base over time.

The debt to capital ratio, expressing the proportion of debt relative to total capital, shows a pattern of gradual improvement in terms of leverage reduction from the start of 2020 through to the end of 2022. The ratio decreases from roughly 0.74-0.75 range during early 2020 to about 0.62 by the end of 2022. This implies a declining reliance on debt relative to total capital over that timeframe. In 2023 and the subsequent periods, the debt to capital ratio stabilizes around the low to mid 0.6 range, fluctuating modestly between 0.60 and 0.65. Such stability suggests a maintained capital structure policy with controlled leverage levels despite the observed increases in total debt during 2023-2025.

Overall, the trends demonstrate a period of debt reduction and capital consolidation through 2021 and 2022, with a cautious reversals in debt increases post-2022, albeit balanced by growth in total capital to keep leverage ratios generally stable. The company appears to balance managing debt levels while incrementally increasing its capital base, maintaining financial leverage at moderate and stable levels over the medium term.

Total Debt

Total debt exhibited an overall fluctuation across the periods analyzed. Initially, it increased from 50,393 million USD in March 2020 to a peak of 52,867 million USD in September 2020. After this, there was a notable decrease to 42,793 million USD by December 2020. Through 2021, total debt remained relatively stable, fluctuating mildly around the low 40,000s million USD mark. In 2022, there was a downward trend, reaching the lowest point of 39,149 million USD by December 2022. However, after this trough, total debt started increasing once again, reaching 49,446 million USD by June 2025, indicating a renewed accumulation of debt over the most recent periods.

Total Assets

Total assets showed moderate volatility with a general upward trend over the examined quarters. Beginning at 94,013 million USD in March 2020, assets slightly increased towards the end of 2020 but experienced a small dip in the first quarter of 2021. Throughout the remainder of 2021 and 2022, asset levels remained relatively stable, oscillating around the mid-90,000s million USD range. Starting in 2023, a gradual increase is observable, with total assets peaking at 106,266 million USD in September 2024 before experiencing a minor decline to 104,333 million USD by June 2025. The overall pattern suggests steady asset growth with minor short-term fluctuations.

Debt to Assets Ratio

The debt to assets ratio demonstrated a decreasing trend from 0.54 in March 2020 to a low of approximately 0.41 in late 2023, reflecting an improvement in the company’s leverage position relative to its asset base. This decline was particularly marked after the peak in late 2020, paralleling the reduction in total debt and relatively stable or growing assets. However, after reaching the low point in late 2023, the ratio stabilized around 0.43 to 0.44 through 2024 before rising to approximately 0.48 by March 2025, coinciding with the renewed increase in total debt. This indicates a modest retracement in leverage, though still below the levels observed at the start of the period.

The data indicate that total assets experienced some fluctuation over the observed periods. Initially, total assets increased from approximately 94,013 million US dollars in March 2020 to a peak around 97,184 million in September 2020, followed by a decline to roughly 87,296 million at the end of 2020. Subsequently, total assets generally exhibited a rising trend, reaching around 106,266 million by September 2024 before slightly decreasing toward the end of the period to approximately 104,333 million by June 2025.

Equity attributable to shareowners demonstrated a mostly upward trajectory throughout the timeline. Starting near 18,158 million US dollars at the beginning of 2020, equity steadily increased with occasional minor declines, reaching approximately 28,585 million by June 2025. This trend suggests a strengthening equity base over time, with notable accelerations especially from late 2021 onward.

Financial leverage, calculated as a ratio, revealed a marked reduction over the analyzed quarters. It decreased from a high of around 5.42 in June 2020 to more moderate levels near 3.65 by mid-2025. This decline indicates a reduction in reliance on debt relative to equity, reflecting improved capital structure and a potential decrease in financial risk. The reduction was relatively consistent, with minor fluctuations but a clear downward trend.

Total Assets

Displayed initial volatility with a dip at the end of 2020, followed by a general upward movement peaking in late 2024 and slight stabilization thereafter.

Equity Attributable to Shareowners

Maintained an overall positive growth trend, indicating an expansion of shareholder equity and possibly retained earnings or capital injections.

Financial Leverage

Consistently declined during the period, suggesting the company is gradually decreasing its financial risk by lowering its debt burden compared to equity.

Earnings Before Interest and Tax (EBIT)

The EBIT values exhibit a fluctuating but overall increasing trend over the periods analyzed. Initial values start at 3203 million USD, followed by a dip to 2471 million USD in the June 2020 quarter, likely reflecting economic challenges during that time. Subsequently, the EBIT recovers with several peaks including 4398 million USD in July 2021 and 4444 million USD in March 2025. Despite intermittent declines, the long-term trend from 2020 through mid-2025 shows gradual improvement, with the highest recorded EBIT reaching 5241 million USD in June 2025.

Interest Expense

Interest expense shows significant volatility and a general upward tendency through the periods. Starting at 193 million USD in March 2020, the expense peaks at 780 million USD in July 2021, then decreases sharply before stabilizing within the range of approximately 198 to 445 million USD in the later quarters. Toward the end of the timeline, interest expenses moderate but still exhibit minor increases, reaching 445 million USD in June 2025. The large spike in mid-2021 may indicate refinancing or increased borrowing during that period.

Interest Coverage Ratio

The interest coverage ratio, which measures the company’s ability to service its debt, shows values only from December 2020 onward. The metric indicates strong and improving coverage across most quarters. Initial reported values near 7.78 to 8.78 signal adequate coverage, which then markedly improves, peaking at 17.35 in December 2022, reflecting a strong EBIT relative to interest expenses. After this peak, the ratio experiences a declining trend but remains relatively high around 8.9 to 9.91 by mid-2025, suggesting the company maintains a robust capacity to cover interest obligations despite fluctuations in EBIT and interest expense.

Overall Insights

The company experienced some initial volatility in EBIT and interest expenses during 2020 and early 2021, which could be attributed to broader market or economic disruptions. Over time, EBIT demonstrates resilience and a growth trend, while the interest expense experiences a significant spike before stabilizing. Interest coverage ratios reflect strong financial health with ample ability to cover interest costs, though there is a slight decline after peaking in late 2022. The trends suggest improving operational profitability alongside manageable debt servicing capability, indicating a stable financial position toward the later quarters analyzed.