Lowe’s Cos. Inc. (NYSE:LOW)

Debt to equity ratio

The debt to equity ratio increased from 9.79 in 2020 to 15.16 in 2021, indicating a rising reliance on debt relative to shareholders' equity during this period. Data for subsequent years is not provided.

Debt to equity ratio including operating lease liability

This ratio followed a similar upward trend from 12.04 in 2020 to 18.24 in 2021, reinforcing the observation of increasing leverage when operating lease liabilities are factored in. Data for later years is not available.

Debt to capital ratio

There is a consistent upward movement from 0.91 in 2020 to 1.24 in 2022. The ratio further increased notably to 1.72 in both 2023 and 2024, with a slight decline to 1.67 in 2025. This suggests an increasing proportion of debt in the company's capital structure peaking in 2023 and 2024 before a marginal reduction.

Debt to capital ratio including operating lease liability

This ratio shows a parallel trend, increasing from 0.92 in 2020 to 1.2 in 2022, further rising to 1.6 in 2023 and 2024, then trending slightly down to 1.56 in 2025. The inclusion of operating lease liabilities consistently elevates the leverage measure, but the overall pattern aligns closely with the debt to capital ratio excluding these liabilities.

Debt to assets ratio

The ratio decreased slightly from 0.49 in 2020 to 0.47 in 2021, followed by a progressive increase to 0.55 in 2022, then a marked rise to 0.78 in 2023 and peaking at 0.86 in 2024, subsequently falling to 0.82 in 2025. This indicates growing debt levels relative to total assets over the period, particularly evident from 2022 onwards.

Debt to assets ratio including operating lease liability

This measure shows a similar trajectory, rising from 0.6 in 2020 to 0.66 in 2022, then increasing sharply to 0.87 in 2023 and peaking at 0.96 in 2024 before a slight decrease to 0.92 in 2025. The inclusion of operating lease liabilities magnifies the debt pressure on asset base, underscoring growing financial commitments.

Financial leverage ratio

The financial leverage ratio increased significantly from 20.02 in 2020 to 32.52 in 2021, indicating a rising use of debt relative to equity. Data continuity for later years is lacking.

Interest coverage ratio

This ratio improved from 8.83 in 2020 to a peak of 13.49 in 2022, suggesting enhanced ability to cover interest expenses at that time. Following the peak, the ratio decreased steadily to 8.79 in 2023, 7.86 in 2024, and 7.22 in 2025, indicating diminishing interest expense coverage over recent years.

Fixed charge coverage ratio

The fixed charge coverage ratio showed an upward trend from 5.04 in 2020 to 8.02 in 2022, demonstrating improved capacity to meet fixed financial obligations. This was followed by a decline to 5.77 in 2023, a slight recovery to 5.82 in 2024, and a fall to 5.19 in 2025, reflecting some weakening in coverage ability in the most recent periods.

Total debt

The total debt shows a consistent upward trajectory from 2020 through 2024, increasing from $19,306 million to a peak of $35,921 million. In 2025, there is a slight decrease to $35,487 million, indicating a stabilization of debt levels after several years of significant growth.

Shareholders’ equity (deficit)

Shareholders’ equity demonstrates a declining trend over the period analyzed. It decreased from $1,972 million in 2020 to a negative balance beginning in 2022, reaching a deficit of -$4,816 million. This downward trend continues steeply into 2023, with the deficit expanding to -$14,254 million. Although the deficit remains substantial in 2024 and 2025 (-$15,050 million and -$14,231 million respectively), it appears to stabilize with slight improvement between these years.

Debt to equity ratio

The debt to equity ratio increased notably from 9.79 in 2020 to 15.16 in 2021, reflecting growing leverage in the context of declining equity. Data beyond 2021 is unavailable, but given the continued erosion of equity into negative territory, it can be inferred that the ratio would be significantly elevated in subsequent years, indicating increased financial risk and dependence on debt financing.

The financial data reveals significant movements in leverage and equity over the observed periods.

Total debt (including operating lease liability)

The total debt has shown a clear increasing trajectory from 23,750 million US dollars in early 2020 to a peak of 40,145 million US dollars by early 2024, followed by a slight reduction to 39,678 million in early 2025. This growth in debt indicates an expanding reliance on borrowed funds over the period, with the highest level recorded in 2024 before a minor decline.

Shareholders’ equity (deficit)

Shareholders’ equity has experienced a notable deterioration, decreasing from a positive 1,972 million US dollars in 2020 to a deficit position starting in 2022. The equity deficit deepens progressively over the subsequent years, reaching -14,231 million US dollars by early 2025. This consistent decline suggests that liabilities increasingly exceed assets, undermining the net worth of the company.

Debt to equity ratio (including operating lease liability)

The debt to equity ratio, available for the first two periods, increased from 12.04 to 18.24 between early 2020 and early 2021, reflecting a worsening leverage position. Data for subsequent years is not provided; however, given the continuing rise in debt and growing equity deficit, it can be inferred that the debt to equity ratio likely increased further, indicating a heavily leveraged capital structure.

Overall, the trends indicate escalating leverage coupled with a substantial erosion of shareholders’ equity, resulting in a precarious financial position characterized by elevated debt levels and negative net equity.

The financial data reveals notable trends in the company's debt and capital structure over the six-year period ending in early 2025. There is a clear pattern of increasing total debt, which rose consistently from $19,306 million in January 2020 to a peak of $35,921 million by February 2024, before a slight decrease to $35,487 million in January 2025.

In contrast, total capital displays variability with an initial increase from $21,278 million in January 2020 to $23,217 million in January 2021, followed by a significant decline to $19,911 million by January 2022. Subsequently, total capital stabilizes around the $20,000 million mark, gradually increasing again to $21,256 million in January 2025.

A key metric, the debt to capital ratio, demonstrates an upward trajectory from 0.91 in January 2020 to a high of 1.72 in both February 2023 and February 2024. This ratio then shows a slight improvement to 1.67 by January 2025, although it remains substantially elevated compared to earlier years. The increased ratio indicates a growing reliance on debt financing relative to the company’s capital base, reaching levels that suggest debt exceeds total capital in recent years.

Overall, the data outlines a trend where the company has significantly increased its leverage, with total debt growing considerably faster than total capital. This heightened leverage could imply increased financial risk, calling for close monitoring of debt management and capital adequacy in future periods.

Total Debt (including operating lease liability)

The total debt has demonstrated a consistent upward trend from 2020 through 2024, increasing from $23,750 million in 2020 to a peak of $40,145 million in 2024. In 2025, there is a slight decline to $39,678 million, indicating a marginal reduction in debt after a period of significant increase.

Total Capital (including operating lease liability)

Total capital shows a different pattern compared to total debt. It increased slightly from $25,722 million in 2020 to $27,648 million in 2021, then declined sharply to $24,568 million in 2022 and further to $23,740 million in 2023. Afterwards, it begins to rise again, reaching $25,095 million in 2024 and $25,447 million in 2025. This indicates some volatility, with a notable contraction during 2022-2023, followed by a recovery phase.

Debt to Capital Ratio (including operating lease liability)

The debt to capital ratio has shown a marked increase over the analyzed periods. Starting relatively high at 0.92 in 2020, it rose to 0.95 in 2021, followed by a substantial jump to 1.2 in 2022 and an even steeper rise to 1.6 in 2023 and 2024. In 2025, it slightly decreases to 1.56. This ratio surpassing 1 from 2022 onwards suggests that debt levels have exceeded the total capital base, highlighting an increased reliance on debt financing with a high leverage position throughout the most recent years.

Total Debt

The total debt exhibited a consistent upward trend over the analyzed periods. Starting at $19,306 million in early 2020, it increased steadily each year, reaching a peak of $35,921 million by early 2024, before slightly decreasing to $35,487 million in early 2025. This suggests a growing reliance on debt financing during the period, with a notable acceleration in debt accumulation between 2021 and 2023.

Total Assets

Total assets displayed a different pattern, initially rising from $39,471 million in early 2020 to a maximum of $46,735 million in early 2021. However, after this peak, total assets declined gradually over the following years, bottoming out at $41,795 million in early 2024 before experiencing a minor recovery to $43,102 million in early 2025. This trend indicates a contraction in asset base post-2021.

Debt to Assets Ratio

The debt to assets ratio remained relatively stable at around 0.49-0.55 during the first three years but then increased sharply from 0.55 in early 2022 to 0.78 in early 2023, reaching a high of 0.86 in early 2024. It marginally decreased to 0.82 in early 2025. The rising ratio reflects an increasing leverage position, primarily due to debt growth outpacing asset levels, particularly evident beyond 2021.

Overall Insights

The data indicates a strategic shift towards higher leverage, as evidenced by rapidly increasing debt and a concomitant rise in debt to assets ratio. Despite initial asset growth, the subsequent decline in the asset base coupled with rising liabilities signals potential risk in financial structure and increased dependency on external funding. The slight moderation in both debt and leverage in the most recent period may suggest efforts towards stabilizing the capital structure.

Total debt (including operating lease liability)

The total debt shows an increasing trend from 2020 through 2024, rising from 23,750 million USD to a peak of 40,145 million USD in 2024. In 2025, there is a slight decline in the total debt amount to 39,678 million USD, indicating a marginal reduction after several years of growth.

Total assets

Total assets increased from 39,471 million USD in 2020 to a peak of 46,735 million USD in 2021. Following that, there is a decline in asset values reaching the lowest point in 2024 at 41,795 million USD, before a modest recovery in 2025 to 43,102 million USD. Overall, the asset base exhibits some volatility with a general downward movement after 2021.

Debt to assets (including operating lease liability)

The debt-to-assets ratio began at 0.60 in 2020 and decreased slightly to 0.56 in 2021, reflecting a period where asset growth outpaced debt increase. However, from 2022 onward, the ratio increased sharply, reaching 0.66 in 2022, then rising significantly to 0.87 in 2023 and peaking at 0.96 in 2024. A minor decrease to 0.92 in 2025 indicates that the company’s leverage remained very high relative to assets, highlighting increased reliance on debt over these years.

Summary

The data indicates that the company has substantially increased its total debt over the five-year period, albeit with a slight reduction in the latest year. Meanwhile, total assets have fluctuated, peaking early in 2021 and declining thereafter with some recovery in the final year. The debt-to-assets ratio trend reflects growing leverage, particularly pronounced from 2022 to 2024, suggesting increased financial risk exposure. The minor improvement in 2025 may indicate initial steps toward deleveraging or stabilization.

The financial data reveals several notable trends over the period analyzed, particularly concerning total assets, shareholders’ equity, and financial leverage.

Total Assets

Total assets exhibited fluctuations throughout the period. Beginning at approximately 39.5 billion USD in early 2020, total assets increased notably to 46.7 billion USD by early 2021. This growth was followed by a decline to just over 44.6 billion USD in early 2022 and a continuing downward trend, reaching approximately 41.8 billion USD by early 2024. A slight recovery is observed in early 2025, with total assets increasing to 43.1 billion USD. Overall, the total asset base grew initially but experienced a contraction in the subsequent years, with a modest rebound at the end of the period.

Shareholders’ Equity (Deficit)

Shareholders’ equity demonstrated a markedly negative trajectory. Starting at 1.97 billion USD in 2020, it declined to 1.44 billion USD in 2021, entering negative territory with a substantial deficit of approximately 4.8 billion USD in 2022. The deficit expanded significantly further in the following years, reaching a peak negative balance of 15.0 billion USD in early 2024 before slightly improving but remaining deeply negative at 14.2 billion USD in early 2025. This ongoing decline points to deteriorating net asset value and suggests potential concerns regarding the company's capital structure and solvency.

Financial Leverage

Financial leverage, calculated as the ratio of total assets to shareholders’ equity, showed an increase from 20.02 in 2020 to 32.52 in 2021. Data for the subsequent years is not available; however, given the significant decline and negative shareholders’ equity reported, it is plausible that financial leverage would have increased dramatically, reflecting heightened financial risk. The reported leverage ratios indicate a high degree of reliance on debt financing relative to equity during the early period.

In summary, the period under review is characterized by an initial expansion of total assets, followed by contraction, coupled with a persistent and worsening decline in shareholders’ equity progressing into substantial deficits. The increase in financial leverage up to 2021 further underscores elevated financial risk. These patterns collectively signal challenges in capital structure management and potentially signal liquidity or solvency concerns that warrant detailed investigation and strategic response.

Earnings before interest and tax (EBIT)

The EBIT demonstrates a general upward trend from 2020 through 2024, increasing from 6,341 million US dollars in 2020 to a peak of 11,658 million US dollars in 2024. However, in 2025, a decline is observed with EBIT falling to 10,625 million US dollars. This indicates overall growth in operating profitability over the examined period, albeit with a recent decrease in the last reported year.

Interest expense, net of amount capitalized

Interest expenses increased consistently throughout the years. Starting at 718 million US dollars in 2020, expenses rose steadily to reach 1,483 million US dollars in 2024, with a marginal slight decline to 1,472 million US dollars in 2025. The rising interest expense may indicate increased borrowing costs or higher debt levels over the period.

Interest coverage ratio

The interest coverage ratio, which measures the company's ability to meet interest obligations from EBIT, showed fluctuations over the period. It improved from 8.83 in 2020 to a high of 13.49 in 2022, indicating strong capacity to cover interest expenses during that year. However, from 2022 onwards, the ratio deteriorated to 7.22 by 2025, reflecting a reduced margin of safety in covering interest costs primarily due to increased interest expenses and the slight decline in EBIT in the final year.

The financial data exhibits several key trends in earnings before fixed charges and tax, fixed charges, and fixed charge coverage over the six-year period.

Earnings before fixed charges and tax

This metric shows an overall upward trend from 2020 to 2025, starting at $7,015 million in 2020 and increasing to a peak of $12,804 million in 2022. Although there is some fluctuation in the last three years, with a dip to $10,930 million in 2023 followed by a rise to $12,288 million in 2024 and then a decrease again to $11,337 million in 2025, the general trajectory remains positive compared to the initial years.

Fixed charges

The fixed charges consistently increased throughout the period. They rose steadily from $1,392 million in 2020 to $2,184 million in 2025. This represents a notable increase of over 56% over the six-year span, indicating rising financial obligations related to interest and other fixed costs.

Fixed charge coverage ratio

The fixed charge coverage ratio, which measures the ability to cover fixed charges with earnings before fixed charges and tax, displayed variability across the years. The ratio improved significantly from 5.04 in 2020 to a high of 8.02 in 2022, reflecting strong coverage at that point. However, it declined afterwards to 5.77 in 2023 and slightly improved to 5.82 in 2024 before slipping again to 5.19 in 2025. This decline suggests that despite growth in earnings, the increased fixed charges have exerted downward pressure on coverage ability in the most recent years.

In summary, while earnings before fixed charges and tax generally increased, the rising fixed charges have constrained the fixed charge coverage ratio, which peaked in 2022 but has since shown a declining trend. This suggests that financial capacity to meet fixed charges remains strong but is becoming less robust relative to the peak coverage period.