Microsoft Excel LibreOffice Calc

Oracle Corp. (ORCL)


Long-term Debt and Solvency Analysis

Difficulty: Beginner


Ratios (Summary)

Oracle Corp., debt and solvency ratios

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Debt to equity 2.58 1.33 1.08 0.93 0.86 0.52
Debt to capital 0.72 0.57 0.52 0.48 0.46 0.34
Interest coverage 6.97 7.43 7.47 8.88 12.33 16.10

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

Ratio Description The company
Debt-to-equity ratio A solvency ratio calculated as total debt divided by total shareholders’ equity. Oracle Corp.’s 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. Oracle Corp.’s debt-to-capital ratio deteriorated from 2017 to 2018 and from 2018 to 2019.

Ratio Description The company
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. Oracle Corp.’s interest coverage ratio deteriorated from 2017 to 2018 and from 2018 to 2019.

Debt to Equity

Oracle Corp., debt to equity calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (USD $ in millions)
Notes payable and other borrowings, current 4,494  4,491  9,797  3,750  1,999  1,508 
Notes payable and other borrowings, non-current 51,673  56,128  48,112  40,105  39,959  22,667 
Total debt 56,167  60,619  57,909  43,855  41,958  24,175 
Total Oracle Corporation stockholders’ equity 21,785  45,726  53,860  47,289  48,663  46,878 
Ratio
Debt to equity1 2.58 1.33 1.08 0.93 0.86 0.52
Benchmarks
Debt to Equity, Competitors
Adobe Inc. 0.44 0.22 0.26 0.27 0.22
Alphabet Inc. 0.02 0.03 0.03 0.04 0.05
Facebook Inc. 0.00 0.00 0.00 0.00 0.01
International Business Machines Corp. 2.73 2.66 2.31 2.80 3.44
Intuit Inc. 0.19 0.36 0.86 0.21 0.16
Microsoft Corp. 0.92 1.19 0.75 0.44 0.25
salesforce.com inc. 0.20 0.18 0.27 0.26 0.34 0.62
Debt to Equity, Sector
Software & Computer Services 0.45 0.51 0.42 0.39 0.32
Debt to Equity, Industry
Technology 0.59 0.60 0.49 0.45 0.32

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

2019 Calculations

1 Debt to equity = Total debt ÷ Total Oracle Corporation stockholders’ equity
= 56,167 ÷ 21,785 = 2.58

Ratio Description The company
Debt-to-equity ratio A solvency ratio calculated as total debt divided by total shareholders’ equity. Oracle Corp.’s debt-to-equity ratio deteriorated from 2017 to 2018 and from 2018 to 2019.

Debt to Capital

Oracle Corp., debt to capital calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (USD $ in millions)
Notes payable and other borrowings, current 4,494  4,491  9,797  3,750  1,999  1,508 
Notes payable and other borrowings, non-current 51,673  56,128  48,112  40,105  39,959  22,667 
Total debt 56,167  60,619  57,909  43,855  41,958  24,175 
Total Oracle Corporation stockholders’ equity 21,785  45,726  53,860  47,289  48,663  46,878 
Total capital 77,952  106,345  111,769  91,144  90,621  71,053 
Ratio
Debt to capital1 0.72 0.57 0.52 0.48 0.46 0.34
Benchmarks
Debt to Capital, Competitors
Adobe Inc. 0.31 0.18 0.20 0.21 0.18
Alphabet Inc. 0.02 0.03 0.03 0.04 0.05
Facebook Inc. 0.00 0.00 0.00 0.00 0.01
International Business Machines Corp. 0.73 0.73 0.70 0.74 0.77
Intuit Inc. 0.16 0.26 0.46 0.18 0.14
Microsoft Corp. 0.48 0.54 0.43 0.31 0.20
salesforce.com inc. 0.17 0.15 0.21 0.21 0.26 0.38
Debt to Capital, Sector
Software & Computer Services 0.31 0.34 0.30 0.28 0.24
Debt to Capital, Industry
Technology 0.37 0.37 0.33 0.31 0.24

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

2019 Calculations

1 Debt to capital = Total debt ÷ Total capital
= 56,167 ÷ 77,952 = 0.72

Ratio Description The company
Debt-to-capital ratio A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. Oracle Corp.’s debt-to-capital ratio deteriorated from 2017 to 2018 and from 2018 to 2019.

Interest Coverage

Oracle Corp., interest coverage calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014
Selected Financial Data (USD $ in millions)
Net income 11,083  3,825  9,335  8,901  9,938  10,955 
Add: Net income attributable to noncontrolling interest 152  135  118  116  113  98 
Add: Income tax expense 1,185  9,066  2,182  2,541  2,896  2,749 
Add: Interest expense 2,082  2,025  1,798  1,467  1,143  914 
Earnings before interest and tax (EBIT) 14,502  15,051  13,433  13,025  14,090  14,716 
Ratio
Interest coverage1 6.97 7.43 7.47 8.88 12.33 16.10
Benchmarks
Interest Coverage, Competitors
Adobe Inc. 32.31 29.73 21.37 14.61 7.05
Alphabet Inc. 307.25 250.48 195.76 189.95 171.88
Facebook Inc. 2,818.89 3,433.33 1,252.80 270.30 214.48
International Business Machines Corp. 16.71 19.56 20.60 35.09 42.31
Intuit Inc. 76.15 45.10 35.37 27.37 43.39
Microsoft Corp. 14.35 11.42 16.89 24.70 47.60
salesforce.com inc. 7.38 3.32 1.29 1.89 -1.91 -3.64
Interest Coverage, Sector
Software & Computer Services 22.66 20.72 23.73 28.81 38.21
Interest Coverage, Industry
Technology 21.47 21.65 24.56 38.02 46.43

Based on: 10-K (filing date: 2019-06-21), 10-K (filing date: 2018-06-22), 10-K (filing date: 2017-06-27), 10-K (filing date: 2016-06-22), 10-K (filing date: 2015-06-25), 10-K (filing date: 2014-06-26).

2019 Calculations

1 Interest coverage = EBIT ÷ Interest expense
= 14,502 ÷ 2,082 = 6.97

Ratio Description The company
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. Oracle Corp.’s interest coverage ratio deteriorated from 2017 to 2018 and from 2018 to 2019.