Analysis of Solvency Ratios
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
Eaton Corp. plc, solvency ratios
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Eaton Corp. plc debt to equity ratio improved from 2021 to 2022 and from 2022 to 2023. |
| Debt to equity ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total shareholders’ equity. | Eaton Corp. plc debt to equity ratio (including operating lease liability) improved from 2021 to 2022 and from 2022 to 2023. |
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | Eaton Corp. plc debt to capital ratio improved from 2021 to 2022 and from 2022 to 2023. |
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | Eaton Corp. plc debt to capital ratio (including operating lease liability) improved from 2021 to 2022 and from 2022 to 2023. |
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | Eaton Corp. plc debt to assets ratio improved from 2021 to 2022 and from 2022 to 2023. |
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | Eaton Corp. plc debt to assets ratio (including operating lease liability) improved from 2021 to 2022 and from 2022 to 2023. |
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Eaton Corp. plc financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023. |
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | Eaton Corp. plc interest coverage ratio improved from 2021 to 2022 and from 2022 to 2023. |
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | Eaton Corp. plc fixed charge coverage ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |
Debt to Equity
Eaton Corp. plc, debt to equity calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | 8) | 324) | 13) | 1) | 255) | |
| Current portion of long-term debt | 1,017) | 10) | 1,735) | 1,047) | 248) | |
| Long-term debt, excluding current portion | 8,244) | 8,321) | 6,831) | 7,010) | 7,819) | |
| Total debt | 9,269) | 8,655) | 8,579) | 8,058) | 8,322) | |
| Total Eaton shareholders’ equity | 19,036) | 17,038) | 16,413) | 14,930) | 16,082) | |
| Solvency Ratio | ||||||
| Debt to equity1 | 0.49 | 0.51 | 0.52 | 0.54 | 0.52 | |
| Benchmarks | ||||||
| Debt to Equity, Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 1.94 | 2.33 | 2.29 | 2.42 | 2.58 | |
| Cummins Inc. | 0.76 | 0.88 | 0.49 | 0.52 | 0.32 | |
| General Electric Co. | 0.77 | 0.89 | 0.87 | 2.11 | 3.21 | |
| Honeywell International Inc. | 1.29 | 1.17 | 1.06 | 1.28 | 0.87 | |
| Lockheed Martin Corp. | 2.55 | 1.68 | 1.07 | 2.02 | 4.05 | |
| RTX Corp. | 0.73 | 0.44 | 0.43 | 0.44 | 1.04 | |
| Debt to Equity, Sector | ||||||
| Capital Goods | 1.49 | 1.30 | 1.22 | 1.68 | 1.97 | |
| Debt to Equity, Industry | ||||||
| Industrials | 1.40 | 1.30 | 1.22 | 1.68 | 1.79 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to equity = Total debt ÷ Total Eaton shareholders’ equity
= 9,269 ÷ 19,036 = 0.49
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Eaton Corp. plc debt to equity ratio improved from 2021 to 2022 and from 2022 to 2023. |
Debt to Equity (including Operating Lease Liability)
Eaton Corp. plc, debt to equity (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | 8) | 324) | 13) | 1) | 255) | |
| Current portion of long-term debt | 1,017) | 10) | 1,735) | 1,047) | 248) | |
| Long-term debt, excluding current portion | 8,244) | 8,321) | 6,831) | 7,010) | 7,819) | |
| Total debt | 9,269) | 8,655) | 8,579) | 8,058) | 8,322) | |
| Current operating lease liabilities (included in Other current liabilities) | 135) | 127) | 120) | 116) | 121) | |
| Noncurrent operating lease liabilities | 533) | 459) | 337) | 326) | 331) | |
| Total debt (including operating lease liability) | 9,937) | 9,241) | 9,036) | 8,500) | 8,774) | |
| Total Eaton shareholders’ equity | 19,036) | 17,038) | 16,413) | 14,930) | 16,082) | |
| Solvency Ratio | ||||||
| Debt to equity (including operating lease liability)1 | 0.52 | 0.54 | 0.55 | 0.57 | 0.55 | |
| Benchmarks | ||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 1.97 | 2.37 | 2.33 | 2.46 | 2.62 | |
| Cummins Inc. | 0.81 | 0.93 | 0.54 | 0.57 | 0.38 | |
| General Electric Co. | 0.84 | 0.96 | 0.94 | 2.20 | 3.32 | |
| Honeywell International Inc. | 1.36 | 1.23 | 1.11 | 1.32 | 0.90 | |
| Lockheed Martin Corp. | 2.73 | 1.81 | 1.19 | 2.21 | 4.40 | |
| RTX Corp. | 0.76 | 0.47 | 0.46 | 0.47 | 1.11 | |
| Debt to Equity (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 1.56 | 1.36 | 1.28 | 1.75 | 2.06 | |
| Debt to Equity (including Operating Lease Liability), Industry | ||||||
| Industrials | 1.57 | 1.45 | 1.36 | 1.83 | 1.89 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Total Eaton shareholders’ equity
= 9,937 ÷ 19,036 = 0.52
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total shareholders’ equity. | Eaton Corp. plc debt to equity ratio (including operating lease liability) improved from 2021 to 2022 and from 2022 to 2023. |
Debt to Capital
Eaton Corp. plc, debt to capital calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | 8) | 324) | 13) | 1) | 255) | |
| Current portion of long-term debt | 1,017) | 10) | 1,735) | 1,047) | 248) | |
| Long-term debt, excluding current portion | 8,244) | 8,321) | 6,831) | 7,010) | 7,819) | |
| Total debt | 9,269) | 8,655) | 8,579) | 8,058) | 8,322) | |
| Total Eaton shareholders’ equity | 19,036) | 17,038) | 16,413) | 14,930) | 16,082) | |
| Total capital | 28,305) | 25,693) | 24,992) | 22,988) | 24,404) | |
| Solvency Ratio | ||||||
| Debt to capital1 | 0.33 | 0.34 | 0.34 | 0.35 | 0.34 | |
| Benchmarks | ||||||
| Debt to Capital, Competitors2 | ||||||
| Boeing Co. | 1.49 | 1.39 | 1.35 | 1.40 | 1.46 | |
| Caterpillar Inc. | 0.66 | 0.70 | 0.70 | 0.71 | 0.72 | |
| Cummins Inc. | 0.43 | 0.47 | 0.33 | 0.34 | 0.24 | |
| General Electric Co. | 0.43 | 0.47 | 0.47 | 0.68 | 0.76 | |
| Honeywell International Inc. | 0.56 | 0.54 | 0.51 | 0.56 | 0.46 | |
| Lockheed Martin Corp. | 0.72 | 0.63 | 0.52 | 0.67 | 0.80 | |
| RTX Corp. | 0.42 | 0.31 | 0.30 | 0.31 | 0.51 | |
| Debt to Capital, Sector | ||||||
| Capital Goods | 0.60 | 0.57 | 0.55 | 0.63 | 0.66 | |
| Debt to Capital, Industry | ||||||
| Industrials | 0.58 | 0.57 | 0.55 | 0.63 | 0.64 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 9,269 ÷ 28,305 = 0.33
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | Eaton Corp. plc debt to capital ratio improved from 2021 to 2022 and from 2022 to 2023. |
Debt to Capital (including Operating Lease Liability)
Eaton Corp. plc, debt to capital (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | 8) | 324) | 13) | 1) | 255) | |
| Current portion of long-term debt | 1,017) | 10) | 1,735) | 1,047) | 248) | |
| Long-term debt, excluding current portion | 8,244) | 8,321) | 6,831) | 7,010) | 7,819) | |
| Total debt | 9,269) | 8,655) | 8,579) | 8,058) | 8,322) | |
| Current operating lease liabilities (included in Other current liabilities) | 135) | 127) | 120) | 116) | 121) | |
| Noncurrent operating lease liabilities | 533) | 459) | 337) | 326) | 331) | |
| Total debt (including operating lease liability) | 9,937) | 9,241) | 9,036) | 8,500) | 8,774) | |
| Total Eaton shareholders’ equity | 19,036) | 17,038) | 16,413) | 14,930) | 16,082) | |
| Total capital (including operating lease liability) | 28,973) | 26,279) | 25,449) | 23,430) | 24,856) | |
| Solvency Ratio | ||||||
| Debt to capital (including operating lease liability)1 | 0.34 | 0.35 | 0.36 | 0.36 | 0.35 | |
| Benchmarks | ||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | 1.47 | 1.37 | 1.34 | 1.39 | 1.43 | |
| Caterpillar Inc. | 0.66 | 0.70 | 0.70 | 0.71 | 0.72 | |
| Cummins Inc. | 0.45 | 0.48 | 0.35 | 0.36 | 0.28 | |
| General Electric Co. | 0.46 | 0.49 | 0.49 | 0.69 | 0.77 | |
| Honeywell International Inc. | 0.58 | 0.55 | 0.53 | 0.57 | 0.47 | |
| Lockheed Martin Corp. | 0.73 | 0.64 | 0.54 | 0.69 | 0.81 | |
| RTX Corp. | 0.43 | 0.32 | 0.31 | 0.32 | 0.53 | |
| Debt to Capital (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 0.61 | 0.58 | 0.56 | 0.64 | 0.67 | |
| Debt to Capital (including Operating Lease Liability), Industry | ||||||
| Industrials | 0.61 | 0.59 | 0.58 | 0.65 | 0.65 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 9,937 ÷ 28,973 = 0.34
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | Eaton Corp. plc debt to capital ratio (including operating lease liability) improved from 2021 to 2022 and from 2022 to 2023. |
Debt to Assets
Eaton Corp. plc, debt to assets calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | 8) | 324) | 13) | 1) | 255) | |
| Current portion of long-term debt | 1,017) | 10) | 1,735) | 1,047) | 248) | |
| Long-term debt, excluding current portion | 8,244) | 8,321) | 6,831) | 7,010) | 7,819) | |
| Total debt | 9,269) | 8,655) | 8,579) | 8,058) | 8,322) | |
| Total assets | 38,432) | 35,014) | 34,027) | 31,824) | 32,805) | |
| Solvency Ratio | ||||||
| Debt to assets1 | 0.24 | 0.25 | 0.25 | 0.25 | 0.25 | |
| Benchmarks | ||||||
| Debt to Assets, Competitors2 | ||||||
| Boeing Co. | 0.38 | 0.42 | 0.42 | 0.42 | 0.20 | |
| Caterpillar Inc. | 0.43 | 0.45 | 0.46 | 0.47 | 0.48 | |
| Cummins Inc. | 0.21 | 0.26 | 0.18 | 0.18 | 0.12 | |
| General Electric Co. | 0.13 | 0.17 | 0.18 | 0.30 | 0.34 | |
| Honeywell International Inc. | 0.33 | 0.31 | 0.30 | 0.35 | 0.27 | |
| Lockheed Martin Corp. | 0.33 | 0.29 | 0.23 | 0.24 | 0.27 | |
| RTX Corp. | 0.27 | 0.20 | 0.20 | 0.20 | 0.31 | |
| Debt to Assets, Sector | ||||||
| Capital Goods | 0.28 | 0.28 | 0.27 | 0.31 | 0.31 | |
| Debt to Assets, Industry | ||||||
| Industrials | 0.29 | 0.29 | 0.29 | 0.32 | 0.32 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to assets = Total debt ÷ Total assets
= 9,269 ÷ 38,432 = 0.24
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | Eaton Corp. plc debt to assets ratio improved from 2021 to 2022 and from 2022 to 2023. |
Debt to Assets (including Operating Lease Liability)
Eaton Corp. plc, debt to assets (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term debt | 8) | 324) | 13) | 1) | 255) | |
| Current portion of long-term debt | 1,017) | 10) | 1,735) | 1,047) | 248) | |
| Long-term debt, excluding current portion | 8,244) | 8,321) | 6,831) | 7,010) | 7,819) | |
| Total debt | 9,269) | 8,655) | 8,579) | 8,058) | 8,322) | |
| Current operating lease liabilities (included in Other current liabilities) | 135) | 127) | 120) | 116) | 121) | |
| Noncurrent operating lease liabilities | 533) | 459) | 337) | 326) | 331) | |
| Total debt (including operating lease liability) | 9,937) | 9,241) | 9,036) | 8,500) | 8,774) | |
| Total assets | 38,432) | 35,014) | 34,027) | 31,824) | 32,805) | |
| Solvency Ratio | ||||||
| Debt to assets (including operating lease liability)1 | 0.26 | 0.26 | 0.27 | 0.27 | 0.27 | |
| Benchmarks | ||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | 0.40 | 0.43 | 0.43 | 0.43 | 0.21 | |
| Caterpillar Inc. | 0.44 | 0.46 | 0.46 | 0.48 | 0.49 | |
| Cummins Inc. | 0.23 | 0.28 | 0.19 | 0.20 | 0.15 | |
| General Electric Co. | 0.14 | 0.19 | 0.19 | 0.31 | 0.35 | |
| Honeywell International Inc. | 0.35 | 0.33 | 0.32 | 0.36 | 0.28 | |
| Lockheed Martin Corp. | 0.36 | 0.32 | 0.26 | 0.26 | 0.29 | |
| RTX Corp. | 0.28 | 0.21 | 0.21 | 0.21 | 0.33 | |
| Debt to Assets (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 0.30 | 0.29 | 0.29 | 0.32 | 0.32 | |
| Debt to Assets (including Operating Lease Liability), Industry | ||||||
| Industrials | 0.33 | 0.33 | 0.32 | 0.35 | 0.34 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 9,937 ÷ 38,432 = 0.26
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | Eaton Corp. plc debt to assets ratio (including operating lease liability) improved from 2021 to 2022 and from 2022 to 2023. |
Financial Leverage
Eaton Corp. plc, financial leverage calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Total assets | 38,432) | 35,014) | 34,027) | 31,824) | 32,805) | |
| Total Eaton shareholders’ equity | 19,036) | 17,038) | 16,413) | 14,930) | 16,082) | |
| Solvency Ratio | ||||||
| Financial leverage1 | 2.02 | 2.06 | 2.07 | 2.13 | 2.04 | |
| Benchmarks | ||||||
| Financial Leverage, Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 4.49 | 5.16 | 5.02 | 5.11 | 5.38 | |
| Cummins Inc. | 3.62 | 3.38 | 2.80 | 2.81 | 2.63 | |
| General Electric Co. | 5.96 | 5.16 | 4.93 | 7.13 | 9.40 | |
| Honeywell International Inc. | 3.88 | 3.73 | 3.47 | 3.68 | 3.17 | |
| Lockheed Martin Corp. | 7.67 | 5.71 | 4.64 | 8.43 | 15.20 | |
| RTX Corp. | 2.71 | 2.19 | 2.21 | 2.25 | 3.34 | |
| Financial Leverage, Sector | ||||||
| Capital Goods | 5.24 | 4.64 | 4.46 | 5.39 | 6.40 | |
| Financial Leverage, Industry | ||||||
| Industrials | 4.76 | 4.44 | 4.27 | 5.25 | 5.63 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Financial leverage = Total assets ÷ Total Eaton shareholders’ equity
= 38,432 ÷ 19,036 = 2.02
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Eaton Corp. plc financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023. |
Interest Coverage
Eaton Corp. plc, interest coverage calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to Eaton ordinary shareholders | 3,218) | 2,462) | 2,144) | 1,410) | 2,211) | |
| Add: Net income attributable to noncontrolling interest | 5) | 4) | 2) | 5) | 2) | |
| Add: Income tax expense | 604) | 445) | 750) | 331) | 378) | |
| Add: Interest expense, net | 151) | 144) | 144) | 149) | 236) | |
| Earnings before interest and tax (EBIT) | 3,978) | 3,055) | 3,040) | 1,895) | 2,827) | |
| Solvency Ratio | ||||||
| Interest coverage1 | 26.34 | 21.22 | 21.11 | 12.72 | 11.98 | |
| Benchmarks | ||||||
| Interest Coverage, Competitors2 | ||||||
| Boeing Co. | 0.18 | -0.98 | -0.88 | -5.71 | -2.19 | |
| Caterpillar Inc. | 26.66 | 20.80 | 17.88 | 8.80 | 19.62 | |
| Cummins Inc. | 5.34 | 15.17 | 25.78 | 24.38 | 27.00 | |
| General Electric Co. | 10.12 | 1.88 | -0.96 | 2.59 | 1.27 | |
| Honeywell International Inc. | 10.36 | 16.41 | 22.09 | 17.75 | 22.17 | |
| Lockheed Martin Corp. | 9.84 | 11.72 | 14.27 | 14.93 | 12.09 | |
| RTX Corp. | 3.32 | 5.64 | 4.71 | -0.65 | 5.65 | |
| Interest Coverage, Sector | ||||||
| Capital Goods | 6.77 | 5.13 | 4.30 | 2.25 | 5.14 | |
| Interest Coverage, Industry | ||||||
| Industrials | 7.17 | 5.71 | 6.21 | 2.23 | 4.59 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Interest coverage = EBIT ÷ Interest expense
= 3,978 ÷ 151 = 26.34
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | Eaton Corp. plc interest coverage ratio improved from 2021 to 2022 and from 2022 to 2023. |
Fixed Charge Coverage
Eaton Corp. plc, fixed charge coverage calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to Eaton ordinary shareholders | 3,218) | 2,462) | 2,144) | 1,410) | 2,211) | |
| Add: Net income attributable to noncontrolling interest | 5) | 4) | 2) | 5) | 2) | |
| Add: Income tax expense | 604) | 445) | 750) | 331) | 378) | |
| Add: Interest expense, net | 151) | 144) | 144) | 149) | 236) | |
| Earnings before interest and tax (EBIT) | 3,978) | 3,055) | 3,040) | 1,895) | 2,827) | |
| Add: Operating lease cost | 200) | 179) | 164) | 184) | 166) | |
| Earnings before fixed charges and tax | 4,178) | 3,234) | 3,204) | 2,079) | 2,993) | |
| Interest expense, net | 151) | 144) | 144) | 149) | 236) | |
| Operating lease cost | 200) | 179) | 164) | 184) | 166) | |
| Fixed charges | 351) | 323) | 308) | 333) | 402) | |
| Solvency Ratio | ||||||
| Fixed charge coverage1 | 11.90 | 10.01 | 10.40 | 6.24 | 7.45 | |
| Benchmarks | ||||||
| Fixed Charge Coverage, Competitors2 | ||||||
| Boeing Co. | 0.31 | -0.70 | -0.64 | -4.75 | -1.19 | |
| Caterpillar Inc. | 19.73 | 14.92 | 12.73 | 6.58 | 13.01 | |
| Cummins Inc. | 4.01 | 8.85 | 10.72 | 9.60 | 9.94 | |
| General Electric Co. | 5.25 | 1.35 | -0.22 | 1.93 | 1.09 | |
| Honeywell International Inc. | 8.13 | 11.00 | 13.67 | 11.49 | 14.06 | |
| Lockheed Martin Corp. | 7.81 | 8.44 | 9.95 | 11.12 | 9.12 | |
| RTX Corp. | 2.81 | 4.40 | 3.66 | -0.22 | 4.31 | |
| Fixed Charge Coverage, Sector | ||||||
| Capital Goods | 5.09 | 3.79 | 3.26 | 1.84 | 3.80 | |
| Fixed Charge Coverage, Industry | ||||||
| Industrials | 4.60 | 3.68 | 4.04 | 1.71 | 3.07 | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 4,178 ÷ 351 = 11.90
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | Eaton Corp. plc fixed charge coverage ratio deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level. |