Eli Lilly & Co. (NYSE:LLY)

Debt to Equity

The debt to equity ratio displays a clear downward trend from March 2020 through December 2021, declining from 5.6 to 1.88, indicating a reduction in reliance on debt relative to equity during this period. From early 2022 onwards, the ratio fluctuates moderately, generally maintaining a lower level than in 2020, but with a gradual upward trend starting around December 2023 and continuing through March 2025, where it reaches 2.44. This suggests a cautious increase in leverage relative to equity in the more recent periods.

Debt to Capital

The debt to capital ratio similarly declines substantially from 0.85 in March 2020 to 0.65 by December 2021, reflecting a reduction in debt as a proportion of total capital. After this period, the ratio stabilizes and then experiences slight increases from late 2023 onward, rising from 0.64 to 0.71 by March 2025, indicating a modest increase in the proportion of debt financing within the capital structure in recent quarters.

Debt to Assets

The debt to assets ratio decreases marginally during the initial period, falling from 0.42 in March 2020 to 0.35 by December 2020, and remains relatively constant around this level through 2022 to early 2023. Starting in mid-2023, the ratio rises steadily, reaching 0.43 by March 2025, implying a gradual increase in debt relative to total assets over the most recent periods.

Financial Leverage

Financial leverage, measured as a ratio, shows a strong downward trend from 13.35 in March 2020 to 5.44 in December 2021, indicating a significant reduction in the use of debt or other liabilities for financing assets. Following this decrease, the leverage ratio stabilizes between approximately 4.65 and 5.55 through late 2023, but evidences a moderate rise in 2024 reaching 5.67 by December 2024 and March 2025. The data points to a period of deleveraging followed by a return to modest increases in leverage.

The analysis of the quarterly financial data reveals several significant trends in the company's capital structure over the observed period.

Total Debt

Total debt exhibited fluctuations in the earlier periods, ranging between approximately $16.3 billion and $17.5 billion through 2020 and 2021. Beginning in early 2022, a gradual increase is observable, with a pronounced acceleration in growth starting in late 2023. By March 31, 2025, total debt reached approximately $38.5 billion, marking a substantial rise from earlier levels.

Total Shareholders’ Equity

Shareholders’ equity showed a consistent upward trajectory from $3.1 billion in March 2020 to roughly $11.2 billion by the end of 2023. However, starting from late 2023 into 2024 and early 2025, equity growth decelerated, displaying marginal fluctuations with a peak at around $14.2 billion in late 2024 before rising again to nearly $15.8 billion by March 2025. Despite overall growth, the pace of increase in equity was relatively slower compared to the acceleration seen in total debt during the same latter period.

Debt to Equity Ratio

The debt to equity ratio demonstrates an initial declining trend from 5.6 in March 2020 to as low as about 1.5 in late 2022, indicating a reduction in leverage and possibly a strengthening of the equity base relative to debt during this interval. Subsequently, the ratio started to increase again gradually, reaching approximately 2.4 by March 2025. This shift reflects a build-up in leverage, consistent with the rapidly rising total debt figures observed in the latter part of the period under review. The rising ratio suggests an increased reliance on debt financing relative to equity.

Overall, the data indicate a strategic change in the company’s capital structure over the five-year span. The initial phase was characterized by debt reduction or stabilization paired with equity growth, resulting in decreased leverage. In contrast, recent quarters reveal a marked increase in indebtedness outpacing equity expansion, thereby elevating the debt to equity ratio. This shift could imply a higher risk profile or a tactical move to leverage debt for growth or acquisitions. Continuous monitoring of this trend is advisable to assess the financial risk and implications for the company's balance sheet strength.

Total debt

The total debt exhibits a fluctuating upward trend over the examined periods. Starting at approximately 17.23 billion US dollars in the first quarter of 2020, it saw some decreases and recoveries throughout the following years. Notably, there was a significant increase beginning in early 2023, rising from around 18.88 billion to 38.52 billion US dollars by the first quarter of 2025. This indicates a substantial growth in the company's leveraged position over the most recent two-year period.

Total capital

Total capital shows a consistent growth pattern throughout the timeline. From about 20.31 billion US dollars in early 2020, it gradually increased, with some minor fluctuations, reaching over 54.28 billion US dollars by the first quarter of 2025. This steady increase demonstrates expanding overall funding, which encompasses both debt and equity components, reflecting potential growth and investment activities.

Debt to capital ratio

The debt to capital ratio initially follows a declining trend from 0.85 in March 2020 to 0.60 by the final quarter of 2022, suggesting a reduction in leverage relative to total capital. However, commencing in early 2023, the ratio reverses course, gradually rising to 0.71 by the first quarter of 2025. This inflection indicates an increasing proportion of debt within the capital structure, correlating with the observed growth in total debt during the same period. The ratio fluctuates moderately over the complete timeline but overall signals a strategic shift toward higher leverage in recent years.

Total debt

The total debt demonstrates a fluctuating yet generally upward trend over the observed period. Initially, the debt decreased from 17,230,300 thousand USD at the end of March 2020 to 16,204,500 thousand USD by March 2021. This was followed by a phase of relative stability with debt figures oscillating around the 16 to 17 billion USD range until the end of 2022. Starting in 2023, however, total debt increased significantly, reaching 38,515,900 thousand USD by March 2025. This marked escalation suggests a substantial rise in borrowing or liabilities during the most recent quarters.

Total assets

Total assets showed a consistent upward trajectory throughout the entire period. From 41,102,800 thousand USD at the close of March 2020, total assets steadily increased to 89,388,800 thousand USD by March 2025. The growth pace appears to accelerate particularly after the end of 2022, indicating ongoing asset accumulation or capital expansion. This positive trend illustrates strengthening asset bases, potentially driven by operational growth, acquisitions, or capital investments.

Debt to assets ratio

The debt to assets ratio generally declined from 0.42 in March 2020 to a low of 0.33 in September and December 2022, reflecting an improving leverage position with relatively faster growth in assets compared to debt. However, from early 2023 onwards, the ratio began to increase again, rising to 0.43 by March 2025. This reversal indicates a growing reliance on debt relative to total assets in the final quarters, despite the continued asset growth, mirroring the sharp rise in total debt during the same timeframe.

Summary

Overall, the financial data reveals a period of initial deleveraging and asset growth followed by a recent phase characterized by accelerated increases in both debt and assets. The initial decline in the debt to assets ratio suggested strengthening financial stability; however, the subsequent rise signals increased leverage which may imply greater risk or strategic investment funded by debt. The pronounced increase in total assets suggests expansion or investment activities, while the corresponding rise in debt warrants careful monitoring in the context of capital structure and risk management.

Total assets

The total assets exhibit an overall upward trend from March 31, 2020, to March 31, 2025. Starting at approximately 41.1 billion USD, assets increase steadily, with minor fluctuations around late 2021 and early 2022. From the end of 2022 onwards, there is a noticeable acceleration in growth, culminating in a substantial rise to nearly 89.4 billion USD by the first quarter of 2025. This suggests ongoing expansion, potentially through investments, acquisitions, or organic growth.

Total Eli Lilly and Company shareholders’ equity

Shareholders’ equity also indicates a general growth pattern during the period analyzed. Beginning at roughly 3.1 billion USD, equity increases significantly by the first quarter of 2021, then experiences some variability with declines around mid-2021 and early 2022. Despite these fluctuations, equity recovers and maintains growth, reaching approximately 15.8 billion USD by March 2025. The variable equity levels may reflect changes in retained earnings, dividend payments, or share repurchase programs.

Financial leverage

The financial leverage ratio shows a declining trend from early 2020 through 2021, decreasing from 13.35 to around 5.44 by December 2021. This decline suggests a reduction in reliance on debt relative to equity during this time frame. After stabilizing around the mid-4 to mid-5 range from late 2021 through 2024, there is a slight upward trend towards the end of the period, reaching approximately 5.67 by March 2025. This may indicate a moderate increase in debt usage compared to equity in the most recent quarters.