Solvency ratios also known as long-term debt ratios measure a company’s ability to meet long-term obligations.

Emerson Electric Co., debt and solvency ratios

Ratio	Description	The company
Debt-to-equity ratio	A solvency ratio calculated as total debt divided by total shareholders’ equity.	Emerson Electric Co.’s debt-to-equity ratio improved from 2016 to 2017 and from 2017 to 2018.
Debt-to-capital ratio	A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity.	Emerson Electric Co.’s debt-to-capital ratio improved from 2016 to 2017 and from 2017 to 2018.

Ratio	Description	The company
Interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments.	Emerson Electric Co.’s interest coverage ratio improved from 2016 to 2017 and from 2017 to 2018.

Emerson Electric Co., debt to equity calculation, comparison to benchmarks

		Sep 30, 2018	Sep 30, 2017	Sep 30, 2016	Sep 30, 2015	Sep 30, 2014	Sep 30, 2013
	Selected Financial Data (USD $ in millions)
	Short-term borrowings and current maturities of long-term debt
	Long-term debt, excluding current maturities
	Total debt
	Common stockholders’ equity
	Ratio
	Debt to equity¹
	Benchmarks
	Debt to Equity, Industry
	Industrials

2018 Calculations

¹ Debt to equity = Total debt ÷ Common stockholders’ equity
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Ratio	Description	The company
Debt-to-equity ratio	A solvency ratio calculated as total debt divided by total shareholders’ equity.	Emerson Electric Co.’s debt-to-equity ratio improved from 2016 to 2017 and from 2017 to 2018.

Emerson Electric Co., debt to capital calculation, comparison to benchmarks

		Sep 30, 2018	Sep 30, 2017	Sep 30, 2016	Sep 30, 2015	Sep 30, 2014	Sep 30, 2013
	Selected Financial Data (USD $ in millions)
	Short-term borrowings and current maturities of long-term debt
	Long-term debt, excluding current maturities
	Total debt
	Common stockholders’ equity
	Total capital
	Ratio
	Debt to capital¹
	Benchmarks
	Debt to Capital, Industry
	Industrials

2018 Calculations

¹ Debt to capital = Total debt ÷ Total capital
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Ratio	Description	The company
Debt-to-capital ratio	A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity.	Emerson Electric Co.’s debt-to-capital ratio improved from 2016 to 2017 and from 2017 to 2018.

Emerson Electric Co., interest coverage calculation, comparison to benchmarks

		Sep 30, 2018	Sep 30, 2017	Sep 30, 2016	Sep 30, 2015	Sep 30, 2014	Sep 30, 2013
	Selected Financial Data (USD $ in millions)
	Net earnings common stockholders
	Add: Net income attributable to noncontrolling interest
	Less: Discontinued operations, net of tax
	Add: Income tax expense
	Add: Interest expense
	Earnings before interest and tax (EBIT)
	Ratio
	Interest coverage¹
	Benchmarks
	Interest Coverage, Industry
	Industrials

2018 Calculations

¹ Interest coverage = EBIT ÷ Interest expense
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Ratio	Description	The company
Interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments.	Emerson Electric Co.’s interest coverage ratio improved from 2016 to 2017 and from 2017 to 2018.

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Discounted Cash Flow (DCF) Valuation
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Analysis
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Emerson Electric Co. (EMR)

Long-term Debt and Solvency Analysis