Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
TJX Cos. Inc., solvency ratios (quarterly data)
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
The solvency position, as indicated by the provided ratios, demonstrates a generally improving trend over the analyzed period, spanning from May 2021 to May 2025, with some stabilization in the most recent quarters. A consistent pattern of decreasing leverage is observed across most metrics, suggesting a reduction in financial risk. However, it is important to note the distinction between ratios that include operating lease liabilities and those that do not, as the inclusion significantly impacts the reported levels of debt.
- Debt to Equity
- The debt to equity ratio exhibits a substantial decline throughout the period, moving from 0.87 in May 2021 to 0.28 in January 2026. This indicates a decreasing reliance on equity financing relative to debt. The most significant reduction occurred between May 2021 and July 2021, followed by a more gradual decrease. The rate of decline slowed considerably after October 2023.
- Debt to Equity (Including Operating Lease Liability)
- While starting at a considerably higher level (2.42 in May 2021), this ratio also demonstrates a consistent downward trend, reaching 1.32 in January 2026. The inclusion of operating lease liabilities results in significantly higher debt levels, highlighting the impact of these obligations on the company’s capital structure. The decline is less pronounced than the standard debt-to-equity ratio, but still indicates a reduction in overall leverage. The rate of decline slowed after April 2023.
- Debt to Capital
- The debt to capital ratio mirrors the trend observed in the debt to equity ratio, decreasing from 0.46 in May 2021 to 0.22 in January 2026. This suggests a decreasing proportion of debt financing within the company’s overall capital structure. The decline is relatively consistent throughout the period.
- Debt to Capital (Including Operating Lease Liability)
- Similar to the debt to equity ratio including operating leases, this metric also shows a decreasing trend, moving from 0.71 in May 2021 to 0.57 in January 2026. The inclusion of operating lease liabilities again results in higher reported debt levels. The rate of decline is moderate and consistent.
- Debt to Assets
- The debt to assets ratio demonstrates a decrease from 0.18 in May 2021 to 0.08 in January 2026, indicating a smaller proportion of assets financed by debt. This suggests improved financial stability and a reduced risk of insolvency. The decline is relatively consistent.
- Debt to Assets (Including Operating Lease Liability)
- This ratio, starting at 0.49 in May 2021, declines to 0.38 in January 2026. The inclusion of operating lease liabilities significantly increases the reported debt levels relative to assets. The trend indicates a reduction in the proportion of assets financed by total debt obligations, including leases.
- Financial Leverage
- Financial leverage, as measured by this ratio, generally decreases from 4.94 in May 2021 to 3.51 in January 2026. This indicates a reduced reliance on borrowed funds to amplify returns. The most substantial decrease occurred between May 2021 and January 2023, with a more moderate decline observed thereafter.
In summary, the analyzed solvency ratios consistently indicate a strengthening financial position over the observed period. The company appears to be reducing its reliance on debt financing, as evidenced by the declining trends in all reported ratios. The impact of operating lease liabilities is substantial and should be considered when evaluating the company’s overall debt burden.
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Debt Ratios
Debt to Equity
TJX Cos. Inc., debt to equity calculation (quarterly data)
| Jan 31, 2026 | Nov 1, 2025 | Aug 2, 2025 | May 3, 2025 | Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Current portion of long-term debt | 999) | 999) | —) | —) | —) | —) | —) | —) | —) | —) | —) | 500) | 500) | 500) | 500) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, exclusive of current installments | 1,870) | 1,870) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 2,860) | 2,859) | 2,858) | 2,857) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Total debt | 2,869) | 2,869) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 3,360) | 3,359) | 3,358) | 3,357) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Shareholders’ equity | 10,190) | 9,359) | 8,866) | 8,503) | 8,393) | 8,173) | 7,782) | 7,502) | 7,302) | 6,833) | 6,608) | 6,422) | 6,364) | 5,665) | 5,397) | 5,595) | 6,003) | 6,445) | 6,406) | 6,139) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to equity1 | 0.28 | 0.31 | 0.32 | 0.34 | 0.34 | 0.35 | 0.37 | 0.38 | 0.39 | 0.42 | 0.43 | 0.52 | 0.53 | 0.59 | 0.62 | 0.60 | 0.56 | 0.52 | 0.52 | 0.87 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||||
| Amazon.com Inc. | — | — | — | — | 0.20 | 0.18 | 0.20 | 0.22 | 0.24 | 0.27 | 0.31 | 0.36 | 0.39 | 0.43 | 0.48 | 0.54 | 0.59 | 0.58 | 0.62 | 0.53 | ||||||
| Home Depot Inc. | 4.35 | 4.62 | 4.91 | 6.57 | 8.04 | 9.43 | 12.61 | 23.53 | 42.25 | 29.32 | 31.54 | 116.72 | 27.65 | 33.10 | 173.11 | — | — | 37.82 | 17.48 | 20.52 | ||||||
| Lowe’s Cos. Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 52.23 | ||||||
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
1 Q4 2026 Calculation
Debt to equity = Total debt ÷ Shareholders’ equity
= 2,869 ÷ 10,190 = 0.28
2 Click competitor name to see calculations.
The debt to equity ratio for the analyzed period demonstrates a consistent downward trend, indicating a strengthening financial position with decreasing reliance on debt financing relative to equity. Initially, the ratio stood at 0.87, but progressively declined over the observed timeframe.
- Initial Period (May 1, 2021 – Oct 29, 2022)
- The ratio began at 0.87 and decreased to 0.59. This represents a significant reduction in leverage during this period. While total debt remained relatively stable, shareholders’ equity experienced moderate growth, contributing to the decline in the ratio. The most substantial decrease occurred between May 1, 2021, and July 31, 2021, falling from 0.87 to 0.52.
- Subsequent Decline (Jan 28, 2023 – Nov 1, 2025)
- The downward trend continued, with the ratio decreasing from 0.53 to 0.31. This phase is characterized by a more pronounced increase in shareholders’ equity, while total debt remained largely consistent. The period between July 29, 2023, and November 1, 2025, shows a steady, albeit gradual, reduction in the ratio.
- Final Period (Jan 31, 2026 – May 3, 2025)
- The ratio further decreased to 0.28. This final decline suggests continued strengthening of the equity base relative to debt. Shareholders’ equity experienced its largest increases during this period, while total debt remained stable.
- Total Debt
- Total debt exhibited relative stability throughout the analyzed period, fluctuating within a narrow range between US$2,861 million and US$5,335 million. The most significant debt levels were observed in the earlier part of the timeframe, with a consistent decline towards the end.
- Shareholders’ Equity
- Shareholders’ equity demonstrated a clear upward trend, increasing from US$6,139 million to US$10,190 million. This growth in equity is the primary driver behind the observed decrease in the debt to equity ratio. The most substantial increases in equity occurred in the later stages of the analyzed period.
Overall, the consistent decline in the debt to equity ratio suggests a decreasing level of financial risk and improved solvency. The company appears to be effectively managing its debt levels while simultaneously growing its equity base.
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Debt to Equity (including Operating Lease Liability)
TJX Cos. Inc., debt to equity (including operating lease liability) calculation (quarterly data)
| Jan 31, 2026 | Nov 1, 2025 | Aug 2, 2025 | May 3, 2025 | Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Current portion of long-term debt | 999) | 999) | —) | —) | —) | —) | —) | —) | —) | —) | —) | 500) | 500) | 500) | 500) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, exclusive of current installments | 1,870) | 1,870) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 2,860) | 2,859) | 2,858) | 2,857) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Total debt | 2,869) | 2,869) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 3,360) | 3,359) | 3,358) | 3,357) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Current portion of operating lease liabilities | 1,726) | 1,709) | 1,669) | 1,660) | 1,636) | 1,642) | 1,621) | 1,615) | 1,620) | 1,682) | 1,618) | 1,609) | 1,610) | 1,574) | 1,572) | 1,576) | 1,577) | 1,606) | 1,613) | 1,651) | ||||||
| Long-term operating lease liabilities, exclusive of current portion | 8,894) | 8,616) | 8,585) | 8,535) | 8,276) | 8,207) | 8,166) | 8,164) | 8,060) | 7,976) | 8,089) | 7,867) | 7,775) | 7,691) | 7,706) | 7,777) | 7,576) | 7,861) | 7,906) | 7,853) | ||||||
| Total debt (including operating lease liability) | 13,489) | 13,194) | 13,121) | 13,062) | 12,778) | 12,714) | 12,651) | 12,642) | 12,542) | 12,519) | 12,568) | 12,836) | 12,744) | 12,623) | 12,634) | 12,709) | 12,507) | 12,821) | 12,871) | 14,839) | ||||||
| Shareholders’ equity | 10,190) | 9,359) | 8,866) | 8,503) | 8,393) | 8,173) | 7,782) | 7,502) | 7,302) | 6,833) | 6,608) | 6,422) | 6,364) | 5,665) | 5,397) | 5,595) | 6,003) | 6,445) | 6,406) | 6,139) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to equity (including operating lease liability)1 | 1.32 | 1.41 | 1.48 | 1.54 | 1.52 | 1.56 | 1.63 | 1.69 | 1.72 | 1.83 | 1.90 | 2.00 | 2.00 | 2.23 | 2.34 | 2.27 | 2.08 | 1.99 | 2.01 | 2.42 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||||||||||||||||||||||
| Amazon.com Inc. | — | — | — | — | 0.41 | 0.41 | 0.46 | 0.49 | 0.52 | 0.58 | 0.64 | 0.71 | 0.77 | 0.84 | 0.91 | 1.00 | 1.06 | 1.05 | 1.08 | 0.97 | ||||||
| Home Depot Inc. | 5.10 | 5.40 | 5.75 | 7.70 | 9.38 | 10.95 | 14.62 | 28.03 | 50.04 | 34.44 | 37.07 | 136.54 | 32.24 | 38.30 | 199.91 | — | — | 43.73 | 20.47 | 23.99 | ||||||
| Lowe’s Cos. Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 62.29 | ||||||
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
1 Q4 2026 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Shareholders’ equity
= 13,489 ÷ 10,190 = 1.32
2 Click competitor name to see calculations.
The debt to equity ratio, inclusive of operating lease liabilities, demonstrates a consistent downward trend over the analyzed period, spanning from May 2021 to May 2025. Initially, the ratio stood at 2.42, indicating a substantial reliance on debt financing relative to equity. However, subsequent quarters reveal a progressive decrease in this ratio, culminating in a value of 1.32 by January 2026, and slightly increasing to 1.41 by May 2025.
- Initial Phase (May 2021 – October 2022)
- The period between May 2021 and October 2022 exhibited a relatively rapid decline in the debt to equity ratio, moving from 2.42 to 2.23. This suggests a focused effort to reduce debt or a concurrent increase in shareholders’ equity during this timeframe. Total debt remained relatively stable, while shareholders’ equity experienced moderate growth.
- Stabilization and Further Decline (January 2023 – November 2024)
- From January 2023 through November 2024, the ratio continued its downward trajectory, albeit at a slower pace. The ratio decreased from 2.00 to 1.56. This phase is characterized by a more balanced growth in both total debt and shareholders’ equity, with equity growth outpacing debt accumulation. The slight increase in total debt in the final periods of this phase did not offset the gains in equity.
- Recent Trend (February 2025 – May 2025)
- The most recent observations indicate a slight increase in the debt to equity ratio, rising from 1.52 in February 2025 to 1.41 in May 2025. This is driven by an increase in total debt, while shareholders’ equity also increased. This suggests a potential shift in financing strategy or increased investment in debt-funded projects.
Overall, the observed trend suggests improving solvency. The decreasing ratio indicates a strengthening financial position, with a reduced reliance on debt financing. The recent slight increase warrants continued monitoring to determine if it represents a temporary fluctuation or the beginning of a new trend.
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Debt to Capital
TJX Cos. Inc., debt to capital calculation (quarterly data)
| Jan 31, 2026 | Nov 1, 2025 | Aug 2, 2025 | May 3, 2025 | Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Current portion of long-term debt | 999) | 999) | —) | —) | —) | —) | —) | —) | —) | —) | —) | 500) | 500) | 500) | 500) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, exclusive of current installments | 1,870) | 1,870) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 2,860) | 2,859) | 2,858) | 2,857) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Total debt | 2,869) | 2,869) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 3,360) | 3,359) | 3,358) | 3,357) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Shareholders’ equity | 10,190) | 9,359) | 8,866) | 8,503) | 8,393) | 8,173) | 7,782) | 7,502) | 7,302) | 6,833) | 6,608) | 6,422) | 6,364) | 5,665) | 5,397) | 5,595) | 6,003) | 6,445) | 6,406) | 6,139) | ||||||
| Total capital | 13,059) | 12,228) | 11,733) | 11,370) | 11,259) | 11,038) | 10,646) | 10,365) | 10,164) | 9,694) | 9,469) | 9,782) | 9,723) | 9,022) | 8,753) | 8,951) | 9,358) | 9,799) | 9,759) | 11,474) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to capital1 | 0.22 | 0.23 | 0.24 | 0.25 | 0.25 | 0.26 | 0.27 | 0.28 | 0.28 | 0.30 | 0.30 | 0.34 | 0.35 | 0.37 | 0.38 | 0.37 | 0.36 | 0.34 | 0.34 | 0.46 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||||
| Amazon.com Inc. | — | — | — | — | 0.16 | 0.15 | 0.17 | 0.18 | 0.19 | 0.21 | 0.24 | 0.26 | 0.28 | 0.30 | 0.32 | 0.35 | 0.37 | 0.37 | 0.38 | 0.35 | ||||||
| Home Depot Inc. | 0.81 | 0.82 | 0.83 | 0.87 | 0.89 | 0.90 | 0.93 | 0.96 | 0.98 | 0.97 | 0.97 | 0.99 | 0.97 | 0.97 | 0.99 | 1.04 | 1.04 | 0.97 | 0.95 | 0.95 | ||||||
| Lowe’s Cos. Inc. | 1.33 | 1.35 | 1.49 | 1.62 | 1.67 | 1.61 | 1.62 | 1.69 | 1.72 | 1.73 | 1.68 | 1.67 | 1.72 | 1.62 | 1.41 | 1.31 | 1.24 | 1.06 | 1.01 | 0.98 | ||||||
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
1 Q4 2026 Calculation
Debt to capital = Total debt ÷ Total capital
= 2,869 ÷ 13,059 = 0.22
2 Click competitor name to see calculations.
The debt to capital ratio for the analyzed period demonstrates a consistent, albeit gradual, downward trend. Initially, the ratio stood at 0.46, indicating that 46% of the company’s capital was financed by debt. Over the subsequent quarters, this proportion decreased, reaching a low of 0.22 by the final period observed.
- Initial Phase (May 1, 2021 – Oct 29, 2022)
- From May 2021 through October 2022, the debt to capital ratio experienced a decline from 0.46 to 0.37. This suggests a reduction in the company’s reliance on debt financing during this timeframe, potentially through increased equity contributions or debt repayment. The decrease was not linear, with some quarterly fluctuations, but the overall direction was consistently downward.
- Subsequent Decline (Jan 28, 2023 – Nov 1, 2025)
- The downward trend continued from January 2023 to November 2025, with the ratio decreasing from 0.35 to 0.23. This period shows a more consistent and pronounced reduction in the proportion of debt financing. The company’s capital structure appears to be shifting towards greater equity funding.
- Final Period (Jan 31, 2026 – May 3, 2025)
- The ratio continued to decrease, reaching 0.22 in January 2026. This indicates a further strengthening of the company’s financial position with a lower level of debt relative to its capital base. The final observed value of 0.23 in May 2025 represents the lowest point in the analyzed period.
- Total Debt and Total Capital Trends
- While the ratio decreased, it is important to note the behavior of the underlying components. Total debt generally decreased over the period, falling from US$5,335 million to US$2,869 million. Total capital exhibited more volatility, initially decreasing and then increasing, ultimately reaching US$13,059 million. The combined effect of these trends resulted in the observed decline in the debt to capital ratio.
In summary, the observed trend suggests a deliberate or opportunistic strategy to reduce financial leverage. A lower debt to capital ratio generally indicates a stronger financial position and reduced risk, as the company is less reliant on borrowed funds to finance its operations and growth.
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Debt to Capital (including Operating Lease Liability)
TJX Cos. Inc., debt to capital (including operating lease liability) calculation (quarterly data)
| Jan 31, 2026 | Nov 1, 2025 | Aug 2, 2025 | May 3, 2025 | Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Current portion of long-term debt | 999) | 999) | —) | —) | —) | —) | —) | —) | —) | —) | —) | 500) | 500) | 500) | 500) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, exclusive of current installments | 1,870) | 1,870) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 2,860) | 2,859) | 2,858) | 2,857) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Total debt | 2,869) | 2,869) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 3,360) | 3,359) | 3,358) | 3,357) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Current portion of operating lease liabilities | 1,726) | 1,709) | 1,669) | 1,660) | 1,636) | 1,642) | 1,621) | 1,615) | 1,620) | 1,682) | 1,618) | 1,609) | 1,610) | 1,574) | 1,572) | 1,576) | 1,577) | 1,606) | 1,613) | 1,651) | ||||||
| Long-term operating lease liabilities, exclusive of current portion | 8,894) | 8,616) | 8,585) | 8,535) | 8,276) | 8,207) | 8,166) | 8,164) | 8,060) | 7,976) | 8,089) | 7,867) | 7,775) | 7,691) | 7,706) | 7,777) | 7,576) | 7,861) | 7,906) | 7,853) | ||||||
| Total debt (including operating lease liability) | 13,489) | 13,194) | 13,121) | 13,062) | 12,778) | 12,714) | 12,651) | 12,642) | 12,542) | 12,519) | 12,568) | 12,836) | 12,744) | 12,623) | 12,634) | 12,709) | 12,507) | 12,821) | 12,871) | 14,839) | ||||||
| Shareholders’ equity | 10,190) | 9,359) | 8,866) | 8,503) | 8,393) | 8,173) | 7,782) | 7,502) | 7,302) | 6,833) | 6,608) | 6,422) | 6,364) | 5,665) | 5,397) | 5,595) | 6,003) | 6,445) | 6,406) | 6,139) | ||||||
| Total capital (including operating lease liability) | 23,679) | 22,553) | 21,987) | 21,565) | 21,171) | 20,887) | 20,433) | 20,144) | 19,844) | 19,352) | 19,176) | 19,258) | 19,108) | 18,288) | 18,031) | 18,304) | 18,510) | 19,266) | 19,278) | 20,978) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to capital (including operating lease liability)1 | 0.57 | 0.59 | 0.60 | 0.61 | 0.60 | 0.61 | 0.62 | 0.63 | 0.63 | 0.65 | 0.66 | 0.67 | 0.67 | 0.69 | 0.70 | 0.69 | 0.68 | 0.67 | 0.67 | 0.71 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||||||||||||||||||||||
| Amazon.com Inc. | — | — | — | — | 0.29 | 0.29 | 0.31 | 0.33 | 0.34 | 0.37 | 0.39 | 0.42 | 0.43 | 0.46 | 0.48 | 0.50 | 0.51 | 0.51 | 0.52 | 0.49 | ||||||
| Home Depot Inc. | 0.84 | 0.84 | 0.85 | 0.89 | 0.90 | 0.92 | 0.94 | 0.97 | 0.98 | 0.97 | 0.97 | 0.99 | 0.97 | 0.97 | 1.00 | 1.04 | 1.04 | 0.98 | 0.95 | 0.96 | ||||||
| Lowe’s Cos. Inc. | 1.29 | 1.30 | 1.41 | 1.52 | 1.56 | 1.51 | 1.52 | 1.57 | 1.60 | 1.61 | 1.57 | 1.57 | 1.60 | 1.51 | 1.34 | 1.26 | 1.20 | 1.05 | 1.01 | 0.98 | ||||||
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
1 Q4 2026 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 13,489 ÷ 23,679 = 0.57
2 Click competitor name to see calculations.
The debt to capital ratio, inclusive of operating lease liabilities, for the analyzed period demonstrates a consistent, albeit gradual, downward trend. Initially, the ratio stood at 0.71, and has decreased over the subsequent reporting periods to 0.57.
- Initial Period (May 1, 2021 - Oct 29, 2022)
- The ratio fluctuated between 0.67 and 0.71 during this timeframe. A slight decrease from 0.71 to 0.67 was observed in the first two quarters, followed by relative stability around 0.67-0.69 for the next six quarters. This suggests a period of consistent capital structure management with moderate leverage.
- Subsequent Decline (Jan 28, 2023 - Nov 1, 2025)
- From January 2023, a more pronounced downward trend became evident. The ratio decreased from 0.67 to 0.59 over the next two and a half years. This indicates a reduction in the proportion of debt financing relative to total capital. The decline appears relatively steady, suggesting deliberate actions to improve the capital structure.
- Recent Period (Jan 31, 2026 - May 3, 2025)
- The most recent reporting periods show a continuation of the declining trend, with the ratio reaching 0.57. This represents the lowest point observed within the analyzed timeframe. The increase from 0.59 to 0.61 in August 2025 was followed by a decrease to 0.57 in November 2025, indicating some fluctuation but maintaining the overall downward trajectory.
- Total Debt and Total Capital
- While the ratio decreased, both total debt and total capital generally increased over the period. The rate of increase in total capital has consistently exceeded that of total debt, driving the observed reduction in the debt to capital ratio. Total debt increased from US$14,839 million to US$13,489 million, while total capital increased from US$20,978 million to US$23,679 million.
Overall, the observed trend suggests a strengthening solvency position, as the company is relying less on debt financing relative to its overall capital base. The consistent decline in the ratio, coupled with the growth in total capital, indicates a proactive approach to financial risk management.
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Debt to Assets
TJX Cos. Inc., debt to assets calculation (quarterly data)
| Jan 31, 2026 | Nov 1, 2025 | Aug 2, 2025 | May 3, 2025 | Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Current portion of long-term debt | 999) | 999) | —) | —) | —) | —) | —) | —) | —) | —) | —) | 500) | 500) | 500) | 500) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, exclusive of current installments | 1,870) | 1,870) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 2,860) | 2,859) | 2,858) | 2,857) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Total debt | 2,869) | 2,869) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 3,360) | 3,359) | 3,358) | 3,357) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Total assets | 35,767) | 35,188) | 32,885) | 31,858) | 31,749) | 32,436) | 30,555) | 29,679) | 29,747) | 30,351) | 28,922) | 28,681) | 28,349) | 28,428) | 27,091) | 27,710) | 28,461) | 30,071) | 28,783) | 30,301) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to assets1 | 0.08 | 0.08 | 0.09 | 0.09 | 0.09 | 0.09 | 0.09 | 0.10 | 0.10 | 0.09 | 0.10 | 0.12 | 0.12 | 0.12 | 0.12 | 0.12 | 0.12 | 0.11 | 0.12 | 0.18 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||||
| Amazon.com Inc. | — | — | — | — | 0.10 | 0.09 | 0.10 | 0.11 | 0.11 | 0.12 | 0.13 | 0.15 | 0.15 | 0.16 | 0.17 | 0.18 | 0.19 | 0.19 | 0.19 | 0.17 | ||||||
| Home Depot Inc. | 0.53 | 0.53 | 0.52 | 0.53 | 0.56 | 0.56 | 0.58 | 0.54 | 0.58 | 0.55 | 0.55 | 0.55 | 0.57 | 0.56 | 0.54 | 0.54 | 0.56 | 0.54 | 0.51 | 0.49 | ||||||
| Lowe’s Cos. Inc. | 0.74 | 0.75 | 0.74 | 0.77 | 0.82 | 0.79 | 0.80 | 0.79 | 0.86 | 0.84 | 0.82 | 0.80 | 0.78 | 0.71 | 0.62 | 0.58 | 0.55 | 0.53 | 0.49 | 0.45 | ||||||
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
1 Q4 2026 Calculation
Debt to assets = Total debt ÷ Total assets
= 2,869 ÷ 35,767 = 0.08
2 Click competitor name to see calculations.
The debt-to-assets ratio for the analyzed period demonstrates a generally decreasing trend, indicating a strengthening solvency position. Initially, the ratio fluctuates before exhibiting a more consistent decline. A review of the specific values reveals a pattern of relative stability followed by a noticeable shift in later periods.
- Initial Period (May 1, 2021 – Oct 29, 2022)
- The debt-to-assets ratio begins at 0.18 and generally decreases to 0.12. There is some fluctuation within this period, with a slight increase from 0.11 to 0.12 between October 30, 2021, and January 29, 2022, but the overall trend is downward. This suggests a reduction in reliance on debt financing relative to the company’s asset base during this timeframe.
- Stabilization Phase (Jan 28, 2023 – Aug 2, 2025)
- From January 28, 2023, through August 2, 2025, the ratio remains remarkably stable, consistently around 0.09 to 0.10. This indicates a period of consistent capital structure management, with debt and assets growing at roughly the same rate. The ratio briefly touches 0.08 in November 1, 2025.
- Recent Trend (Nov 1, 2025 – May 3, 2025)
- The most recent observations show the ratio holding steady at 0.08, suggesting continued conservative financial leverage. Total debt has remained relatively constant while total assets have increased, contributing to the lower ratio. This indicates a strengthening financial position and reduced risk associated with debt obligations.
- Total Debt and Total Assets
- Total debt decreased from approximately US$5.3 billion in May 2021 to around US$2.9 billion by May 2024, and has remained stable since. Total assets experienced a more variable trajectory, initially decreasing from US$30.3 billion to US$27.1 billion, then increasing to US$35.8 billion by January 2026. The combined effect of decreasing debt and increasing assets is the observed decline in the debt-to-assets ratio.
In summary, the observed trend in the debt-to-assets ratio suggests improving solvency. The company appears to be effectively managing its debt levels relative to its asset base, resulting in a more financially stable position over the analyzed period.
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Debt to Assets (including Operating Lease Liability)
TJX Cos. Inc., debt to assets (including operating lease liability) calculation (quarterly data)
| Jan 31, 2026 | Nov 1, 2025 | Aug 2, 2025 | May 3, 2025 | Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Current portion of long-term debt | 999) | 999) | —) | —) | —) | —) | —) | —) | —) | —) | —) | 500) | 500) | 500) | 500) | —) | —) | —) | —) | —) | ||||||
| Long-term debt, exclusive of current installments | 1,870) | 1,870) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 2,860) | 2,859) | 2,858) | 2,857) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Total debt | 2,869) | 2,869) | 2,867) | 2,867) | 2,866) | 2,865) | 2,864) | 2,863) | 2,862) | 2,861) | 2,861) | 3,360) | 3,359) | 3,358) | 3,357) | 3,356) | 3,355) | 3,354) | 3,353) | 5,335) | ||||||
| Current portion of operating lease liabilities | 1,726) | 1,709) | 1,669) | 1,660) | 1,636) | 1,642) | 1,621) | 1,615) | 1,620) | 1,682) | 1,618) | 1,609) | 1,610) | 1,574) | 1,572) | 1,576) | 1,577) | 1,606) | 1,613) | 1,651) | ||||||
| Long-term operating lease liabilities, exclusive of current portion | 8,894) | 8,616) | 8,585) | 8,535) | 8,276) | 8,207) | 8,166) | 8,164) | 8,060) | 7,976) | 8,089) | 7,867) | 7,775) | 7,691) | 7,706) | 7,777) | 7,576) | 7,861) | 7,906) | 7,853) | ||||||
| Total debt (including operating lease liability) | 13,489) | 13,194) | 13,121) | 13,062) | 12,778) | 12,714) | 12,651) | 12,642) | 12,542) | 12,519) | 12,568) | 12,836) | 12,744) | 12,623) | 12,634) | 12,709) | 12,507) | 12,821) | 12,871) | 14,839) | ||||||
| Total assets | 35,767) | 35,188) | 32,885) | 31,858) | 31,749) | 32,436) | 30,555) | 29,679) | 29,747) | 30,351) | 28,922) | 28,681) | 28,349) | 28,428) | 27,091) | 27,710) | 28,461) | 30,071) | 28,783) | 30,301) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Debt to assets (including operating lease liability)1 | 0.38 | 0.37 | 0.40 | 0.41 | 0.40 | 0.39 | 0.41 | 0.43 | 0.42 | 0.41 | 0.43 | 0.45 | 0.45 | 0.44 | 0.47 | 0.46 | 0.44 | 0.43 | 0.45 | 0.49 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||||||||||||||||||||||
| Amazon.com Inc. | — | — | — | — | 0.21 | 0.21 | 0.22 | 0.23 | 0.24 | 0.26 | 0.27 | 0.29 | 0.29 | 0.32 | 0.32 | 0.33 | 0.33 | 0.34 | 0.34 | 0.32 | ||||||
| Home Depot Inc. | 0.62 | 0.62 | 0.61 | 0.62 | 0.65 | 0.65 | 0.67 | 0.64 | 0.68 | 0.65 | 0.65 | 0.65 | 0.66 | 0.65 | 0.62 | 0.62 | 0.64 | 0.62 | 0.60 | 0.58 | ||||||
| Lowe’s Cos. Inc. | 0.83 | 0.84 | 0.84 | 0.86 | 0.92 | 0.89 | 0.90 | 0.89 | 0.96 | 0.94 | 0.91 | 0.88 | 0.87 | 0.81 | 0.72 | 0.68 | 0.66 | 0.63 | 0.58 | 0.54 | ||||||
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
1 Q4 2026 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 13,489 ÷ 35,767 = 0.38
2 Click competitor name to see calculations.
The debt to assets ratio, including operating lease liability, for the analyzed period demonstrates a generally decreasing trend with some fluctuations. Initially, the ratio exhibited a decline from 0.49 in May 2021 to 0.43 in October 2021. Subsequent quarters saw some volatility, with the ratio increasing to 0.47 in July 2022 before decreasing again to 0.41 in October 2022. The ratio continued to fluctuate around the 0.40-0.45 range through early 2023, reaching a low of 0.41 in January 2023 and 0.43 in April 2023.
- Overall Trend
- From July 2023 through November 2025, a consistent downward trend is observed, decreasing from 0.43 to 0.37. The most recent periods, from February 1, 2025, to January 31, 2026, show a slight increase, moving from 0.40 to 0.38. The final reported value, as of January 31, 2026, is 0.38.
- Magnitude of Change
- The largest single-period decrease occurred between November 1, 2025, and January 31, 2026, with a decrease of 0.03. The largest single-period increase occurred between May 3, 2025, and August 2, 2025, with an increase of 0.01.
- Recent Performance
- In the most recent four quarters, the ratio has remained relatively stable, fluctuating between 0.37 and 0.41. This suggests a period of consolidation in the company’s leverage position. The slight increase in the final reported period may indicate a minor shift in capital structure, but further analysis would be required to determine the significance of this change.
Throughout the analyzed period, the debt to assets ratio remained below 0.50, indicating that assets consistently exceeded liabilities. The observed trend suggests a gradual reduction in reliance on debt financing relative to the company’s asset base.
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Financial Leverage
TJX Cos. Inc., financial leverage calculation (quarterly data)
| Jan 31, 2026 | Nov 1, 2025 | Aug 2, 2025 | May 3, 2025 | Feb 1, 2025 | Nov 2, 2024 | Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Total assets | 35,767) | 35,188) | 32,885) | 31,858) | 31,749) | 32,436) | 30,555) | 29,679) | 29,747) | 30,351) | 28,922) | 28,681) | 28,349) | 28,428) | 27,091) | 27,710) | 28,461) | 30,071) | 28,783) | 30,301) | ||||||
| Shareholders’ equity | 10,190) | 9,359) | 8,866) | 8,503) | 8,393) | 8,173) | 7,782) | 7,502) | 7,302) | 6,833) | 6,608) | 6,422) | 6,364) | 5,665) | 5,397) | 5,595) | 6,003) | 6,445) | 6,406) | 6,139) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||||
| Financial leverage1 | 3.51 | 3.76 | 3.71 | 3.75 | 3.78 | 3.97 | 3.93 | 3.96 | 4.07 | 4.44 | 4.38 | 4.47 | 4.45 | 5.02 | 5.02 | 4.95 | 4.74 | 4.67 | 4.49 | 4.94 | ||||||
| Benchmarks | ||||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||||
| Amazon.com Inc. | — | — | — | — | 1.99 | 1.97 | 2.04 | 2.10 | 2.19 | 2.26 | 2.35 | 2.45 | 2.61 | 2.66 | 2.83 | 3.01 | 3.17 | 3.12 | 3.19 | 3.07 | ||||||
| Home Depot Inc. | 8.20 | 8.77 | 9.38 | 12.46 | 14.48 | 16.81 | 21.91 | 43.53 | 73.30 | 52.85 | 57.22 | 211.01 | 48.94 | 59.22 | 319.94 | — | — | 70.56 | 34.20 | 41.51 | ||||||
| Lowe’s Cos. Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 115.06 | ||||||
Based on: 10-K (reporting date: 2026-01-31), 10-Q (reporting date: 2025-11-01), 10-Q (reporting date: 2025-08-02), 10-Q (reporting date: 2025-05-03), 10-K (reporting date: 2025-02-01), 10-Q (reporting date: 2024-11-02), 10-Q (reporting date: 2024-08-03), 10-Q (reporting date: 2024-05-04), 10-K (reporting date: 2024-02-03), 10-Q (reporting date: 2023-10-28), 10-Q (reporting date: 2023-07-29), 10-Q (reporting date: 2023-04-29), 10-K (reporting date: 2023-01-28), 10-Q (reporting date: 2022-10-29), 10-Q (reporting date: 2022-07-30), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-29), 10-Q (reporting date: 2021-10-30), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-05-01).
1 Q4 2026 Calculation
Financial leverage = Total assets ÷ Shareholders’ equity
= 35,767 ÷ 10,190 = 3.51
2 Click competitor name to see calculations.
The financial leverage ratio for the analyzed period demonstrates a generally decreasing trend, although with some fluctuation. Initially, the ratio exhibits a decline from 4.94 to 4.49, followed by a slight increase to 4.67, before stabilizing around the 4.7 to 5.0 range through early 2022. A more pronounced decrease begins in the latter half of 2022 and continues into 2023, reaching a low of 3.93. This downward trend persists into 2024 and 2025, with the ratio falling to 3.51 by early 2026.
- Overall Trend
- The overall trend indicates a reduction in financial leverage over the analyzed timeframe. This suggests a decreasing reliance on debt financing relative to equity. The most significant reduction occurs between late 2022 and early 2026.
- Initial Period (May 2021 – October 2021)
- The initial period shows a moderate decrease in financial leverage, moving from 4.94 to 4.67. This suggests a slight improvement in the company’s capital structure during this time, potentially through increased equity or reduced debt.
- Stabilization and Subsequent Decline (November 2021 – April 2023)
- From November 2021 through April 2023, the ratio fluctuates between approximately 4.4 and 5.0, indicating a period of relative stability in the company’s financial leverage. However, a clear downward trend emerges towards the end of this period, dropping to 4.38 by April 2023.
- Accelerated Decrease (May 2023 – January 2026)
- The period from May 2023 to January 2026 witnesses a consistent and accelerating decline in financial leverage. The ratio decreases from 4.38 to 3.51, representing a substantial shift in the company’s capital structure. This suggests a deliberate strategy to reduce debt or a significant increase in equity.
- Supporting Factors
- The observed decrease in financial leverage is accompanied by an increase in shareholders’ equity throughout the period. This indicates that the reduction in leverage is not solely attributable to debt reduction, but also to a strengthening of the equity base. Total assets also show a general increasing trend, though not as pronounced as the equity increase.
In conclusion, the company has demonstrably reduced its financial leverage over the analyzed period, primarily driven by growth in shareholders’ equity. This suggests a strengthening financial position and reduced risk associated with debt financing.
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