Procter & Gamble Co. (NYSE:PG)

The financial ratios over the observed periods reveal various trends in the company's capital structure, leverage, and ability to cover interest expenses.

Debt to Equity Ratio

The debt to equity ratio fluctuates moderately, beginning around 0.63 at the end of 2019 and experiencing a slight increase and decrease over the quarters. There is a notable rise to around 0.8 in late 2021, indicating a relative increase in debt compared to equity during this time. The ratio then declines somewhat, settling near 0.65-0.7 in the latter periods through mid-2025, suggesting a stabilization or slight reduction in reliance on debt compared to equity overall.

Debt to Capital Ratio

This ratio remains fairly consistent throughout the periods, maintaining around 0.39 to 0.44. Slight increases occur towards late 2021 and early 2023, but these changes are relatively small. The persistence of these values suggests a stable balance between debt and total capital funding sources.

Debt to Assets Ratio

The ratio shows some volatility but generally trends between 0.25 and 0.31. Higher points are observed around early 2020 and mid-2023, indicating periods where debt makes up a larger portion of the company's assets. However, the variations remain contained within a moderate range, signifying relatively stable asset financing with debt.

Financial Leverage

Financial leverage moves within a range of approximately 2.35 to 2.72, peaking around late 2021. This indicates that the company used more borrowed funds relative to its equity at that time. Following this peak, financial leverage decreases gradually, reflecting a shift towards a less leveraged capital structure or an increase in equity relative to debt.

Interest Coverage Ratio

Interest coverage exhibits a clear downward trend from a high level of 35.05 in mid-2020 to about 20.3-23.2 in the latest periods. While the initial values indicate strong capacity to cover interest expenses many times over, the steady decline could signal increasing interest costs relative to earnings or reduced earnings before interest and taxes. Despite the decrease, the ratio remains above 20, which typically suggests continued comfortable coverage of interest obligations.

Overall, the company's leverage ratios show moderate fluctuations with a temporary increase in debt usage peaking around late 2021, followed by a period of stabilization and slightly reduced leverage. The consistent debt to capital and debt to assets ratios imply steady financing proportions. However, the declining interest coverage ratio warrants attention as it may imply tightening margins or rising finance costs, though coverage remains solid.

The analysis of the quarterly financial data reveals several noteworthy trends and fluctuations over the examined period.

Total Debt

Total debt shows considerable variability, with values ranging from a low of approximately 28,138 million US dollars at the end of 2019 to peaks exceeding 36,000 million US dollars in early 2020 and again in late 2021 and 2024. There is a discernible increase in total debt during the first quarter of 2020, followed by a moderate decline in subsequent quarters. Debt levels fluctuated around the 31,000–36,000 million US dollar range in the later periods, indicating some volatility but no consistent upward or downward trend over the entire timeframe. By the latest quarters, total debt appears to stabilize near the mid-30,000 million US dollar level.

Shareholders’ Equity Attributable to Procter & Gamble

Shareholders’ equity demonstrates a relatively stable yet slightly increasing trajectory over the analyzed quarters. Starting at approximately 46,578 million US dollars in late 2019, equity experiences minor declines mid-2021 and again toward late 2022, but the general trend is upward, reaching just over 52,000 million US dollars by early 2025. The fluctuations in equity are less pronounced than those observed in total debt, suggesting more consistent equity levels with modest growth.

Debt to Equity Ratio

The debt to equity ratio fluctuates within a moderate range between roughly 0.62 and 0.81. Notably, the ratio peaks above 0.8 during the first quarter of 2023, reflecting a relative increase in debt or decrease in equity during this period. Throughout most of the timeline, the ratio hovers around 0.65 to 0.75, indicating balanced leverage conditions. Recent quarters show a decreasing pattern in this ratio, moving from approximately 0.75 down to near 0.65, implying a slight improvement in the capital structure through either reduced leverage or increased equity.

In summary, total debt displays substantial quarter-to-quarter variability without a clear long-term upward or downward trend. Shareholders’ equity steadily increases, contributing to a stable financial foundation. The debt to equity ratio remains moderate, peaking at times but generally maintaining a balanced leverage position. Recent data points suggest a trend towards marginally lower leverage levels, aligning with gradual equity growth. These patterns indicate prudent management of financial leverage and capital structure stability over the observed periods.

The financial data reveals notable trends in the company's leverage and capital structure over the observed periods.

Total Debt

Total debt fluctuated between approximately $28 billion and $36 billion. Starting at $29.5 billion in late 2019, it reached a peak near $36 billion during early 2020. Subsequently, there was some volatility with declines and rises, hitting another peak of $36.6 billion by the end of 2021. From 2022 onward, total debt generally oscillated in the $31 billion to $36 billion range, with a slight decreasing trend toward mid-2024 before a modest increase again.

Total Capital

Total capital remained within the $73 billion to $88 billion range throughout the periods. It showed a gradual increase over time, from $76 billion in late 2019 to near $88 billion by late 2024. This indicates a slow but consistent expansion in the company's capital base, despite some short-term fluctuations.

Debt to Capital Ratio

The debt to capital ratio consistently hovered between 0.38 and 0.45. It rose sharply in early 2020, peaking at 0.44, likely reflecting an increase in debt relative to capital during that period. Thereafter, it exhibited moderate oscillations, generally maintaining just above 0.40, suggesting that debt levels constituted around 40% to 44% of total capital, with minor decreases closer to 0.39 observed in mid-2024.

Overall, the data indicates that while total debt experienced some volatility, the company maintained a stable leverage profile relative to its capital structure. The gradual growth in total capital suggests an expanding asset or equity base, which, combined with the relatively stable debt to capital ratio, signifies careful management of financial leverage over the quarters. The peaks in debt and debt to capital ratio around early 2020 may reflect responses to external conditions impacting financing, followed by a period of relative stabilization.

Total Debt

The total debt exhibits considerable fluctuations over the observed periods. Beginning at approximately $29.5 billion in late 2019, it initially decreases towards the end of 2019 but then rises sharply to a peak exceeding $36 billion in the first quarter of 2020. Following that surge, debt levels fluctuate moderately, generally sustaining values between $31 billion and $36 billion through 2023. The highest recorded value is about $36.6 billion in early 2023. Towards the most recent periods, despite some decline, total debt remains elevated relative to the 2019 baseline, suggesting the company has maintained a substantial debt load in recent years.

Total Assets

Total assets demonstrate a more stable and moderately increasing trend over time. Beginning at around $114 billion in late 2019, assets fluctuate with minor declines and recoveries but generally show a gradual upward shift, reaching approximately $126 billion by the end of 2024. This gradual growth indicates ongoing asset accumulation or valuation increases, despite periodic volatility that can be attributed to market or operational factors. Overall, total assets have increased by roughly 10% over the span, pointing to sustained company growth or investment.

Debt to Assets Ratio

The debt to assets ratio presents a pattern consistent with the relative movements of debt and assets. Starting around 0.26, this ratio rises to about 0.30 at the peak of debt in early 2020, indicating increased leverage. Following this peak, the ratio oscillates between 0.25 and 0.31, showing that leverage has remained somewhat elevated but fairly stable in recent years. The ratio never returns to the lower levels seen in early periods, reflecting a consistent reliance on debt. The recent figures around 0.28 indicate the company carries debt equivalent to roughly 28% of its assets, suggesting a moderate leverage position that is cautious but not aggressively conservative.

Insights and Summary

Overall, the financial data reveals the company has experienced periods of increased borrowing, particularly in early 2020, likely influenced by external economic conditions. Despite fluctuations, the total debt remains at a higher level than initially observed in 2019. Total assets have grown moderately and steadily, supporting operational scale or investments. Consequently, the leverage ratio has increased slightly from its initial levels, stabilizing around 0.28 in recent periods. This suggests a balanced approach to financing, combining asset growth with a stable debt structure, potentially aimed at optimizing capital cost while maintaining financial flexibility.

Total Assets

Total assets showed moderate fluctuations over the observed period. Initially, there was an upward trend from approximately 114 billion USD in September 2019 to a peak near 121 billion USD by December 2021. Subsequently, a decline is observable through 2022 into mid-2023, reaching around 116 billion USD in September 2022. From late 2023 onward, total assets again increased steadily, reaching around 126 billion USD by September 2024 before slightly declining towards the end of the data series.

This pattern suggests periods of asset growth and consolidation, possibly reflecting investment cycles, adjustments in asset holdings, or the impact of operational activities and financing decisions over time.

Shareholders’ Equity Attributable to Procter & Gamble

Shareholders' equity displayed a somewhat cyclical behavior within the timeframe analyzed. The equity increased from roughly 46.5 billion USD in late 2019 to a peak of about 48.2 billion USD in September 2020. Thereafter, there was a slight downward drift through the end of 2021 and into 2022, with a notable trough around 44 billion USD in late 2022. Following this dip, equity values gradually climbed again, reaching just over 52 billion USD by March 2025.

This trend may indicate impacts from earnings performance, dividend policies, share repurchases, or other equity-related transactions, with some volatility reflecting external economic factors or internal capital management strategies.

Financial Leverage (Ratio)

The financial leverage ratio exhibited a pattern of gradual decline over the total period. Starting at roughly 2.45 in late 2019, the ratio increased slightly, peaking between 2.6 and 2.72 during 2020-2021. After this peak, a consistent decrease is noted, with the ratio falling to approximately 2.35 by early 2025, indicating a move toward lower leverage levels.

This trend suggests a reduction in reliance on debt relative to equity, possibly due to debt repayment, asset growth outpacing liabilities, or strategic shifts towards a more conservative capital structure. The decreased leverage could imply lower financial risk over time.

The analysis of the quarterly financial data reveals several notable trends in earnings before interest and tax (EBIT), interest expense, and interest coverage over the period from September 2019 through June 2025.

Earnings Before Interest and Tax (EBIT)

The EBIT values demonstrate significant fluctuations across the quarters. Initially, EBIT remained relatively stable around the 3600 to 4600 million US$ range in late 2019 and early 2020, with a notable dip in March 2020 (3598 million), possibly related to external economic factors. Starting from September 2020, there was a marked increase in EBIT, reaching a peak of approximately 5433 million US$.

Following this peak, EBIT values oscillated but largely maintained an upward bias, with occasional declines observed in quarters such as March 2021 and June 2022. Noteworthy is the substantial rise in EBIT around September 2023 where it peaked at 6027 million US$, the highest observed in the dataset.

Overall, EBIT displays a general uptrend with intermittent volatility, indicating resilience in core operational profitability despite some quarter-to-quarter variability.

Interest Expense

The interest expense figures reveal a gradual increase over time. From a starting point of around 100 to 108 million US$ in 2019, the interest expense rose consistently through the subsequent quarters, peaking at 248 million US$ around September 2023.

Notable spikes occur in the final quarters of 2022 and throughout 2023, suggesting increased borrowing costs or higher debt levels. Small fluctuations occur in early 2024 and afterwards but generally remain elevated compared to the initial years.

This upward trend in interest expense points toward potentially rising leverage or increased interest rates impacting the financing costs of the company.

Interest Coverage Ratio

The interest coverage ratio is relatively high throughout the available quarters, indicating strong ability to cover interest obligations with EBIT. Early data from mid-2020 shows ratios in the range of 32 to 41, demonstrating robust earnings relative to interest expenses.

There is a declining trend in interest coverage from around 41 in early 2022 down to approximately 20 by late 2024, suggesting that while EBIT increased over time, interest expenses grew at a faster rate, causing a squeeze in the margin of safety regarding interest payments.

Despite this decline, the ratio remains significantly above 20, which generally signals a comfortable coverage level and low risk of default on interest payments.

In summary, the financial data indicates that while EBIT has generally strengthened with some volatility, rising interest expenses have exerted pressure on interest coverage ratios. Nonetheless, the company continues to maintain substantial ability to meet interest obligations. Monitoring the balance between operational income growth and financing costs will be critical for maintaining financial stability moving forward.