Illumina Inc. (NASDAQ:ILMN)

Debt to Equity Ratios

The debt to equity ratio exhibited moderate fluctuations throughout the periods, generally ranging from approximately 0.16 to 0.57. Early periods showed ratios close to the mid-0.40s, followed by a decrease to near 0.25 during late 2019 and most of 2020, indicating a reduction in reliance on debt relative to equity. By late 2021, the ratio notably declined to a low of 0.16, suggesting a significant deleveraging.

When including operating lease liabilities, the debt to equity ratio showed higher peaks, particularly in early 2019 where it reached 0.62, and again in 2021 with values around 0.57 and 0.46 before sharply decreasing to 0.23. This indicates that lease obligations contributed meaningfully to the overall leverage, especially in certain quarters.

Debt to Capital Ratios

The debt to capital ratio followed a trend similar to debt to equity, mostly oscillating between 0.20 and 0.36. There was a visible decline from early 2019 through 2020, with the ratio stabilizing at approximately 0.20, reflecting a strengthened capital structure.

With operating leases included, debt to capital ratios were consistently higher, peaking around 0.38 in early 2019, but generally staying under 0.32 in 2021 before dropping toward the end of the period. This pattern again emphasizes the relevance of operating leases in the company's capital commitments.

Debt to Assets Ratios

Debt to assets ratios remained comparatively low across all periods, generally below 0.30. The values demonstrated a steady decrease after 2018, dropping from near 0.29 to about 0.16 through 2020, which implies improved asset coverage against debt.

Adjusting for operating lease liabilities increased these ratios moderately, emphasizing the impact of lease obligations on total indebtedness relative to asset base. The highest ratio with leases included was 0.33 in 2019, tapering down to around 0.16 by late 2021.

Financial Leverage

The financial leverage ratio stayed relatively stable, fluctuating between 1.42 and 1.93 without dramatic shifts. A notable decrease to around 1.42 occurred at the end of the period in 2021, reflecting an overall reduction in leverage and potentially a more conservative financial position.

Interest Coverage

Interest coverage ratios showed a declining trend from a high around 30 in early 2017 to a lower but still comfortable range between approximately 15 and 23 thereafter. The initial drop by 2018 down to about 16-20 suggests a reduction in earnings available to cover interest expenses, although ratios remained strong, indicating the ability to service debt comfortably throughout the periods analyzed.

Total Debt

The total debt of the company exhibited fluctuations over the analyzed periods. Initially, from early 2017 to mid-2018, debt increased moderately from 1,248 million to 1,369 million USD. A significant spike occurred during late 2018, with debt rising to nearly 2,000 million USD. Following this peak, debt levels declined steadily through 2019 and 2020, reaching a low point close to 1,150 million USD by the end of 2020. In early 2021, total debt surged again, exceeding 2,100 million USD, before declining once more toward approximately 1,680 million USD by late 2021.

Total Illumina Stockholders’ Equity

The stockholders’ equity demonstrated a general upward trajectory across the reported quarters. Starting from about 2,551 million USD in early 2017, equity increased steadily with only minor fluctuations, culminating in a substantial jump to over 10,500 million USD by the last quarter in 2021. This marked increase at the end of the period suggests significant growth in equity or a possible revaluation or capital injection event during 2021.

Debt to Equity Ratio

The debt to equity ratio reflects the relationship between the company's debt and its equity. Initially, this ratio hovered around 0.45 to 0.49 during 2017, indicating moderate leverage. It rose to a higher level near 0.57 in late 2018, which coincides with the observed spike in total debt during the same period. Subsequently, the ratio decreased substantially to about 0.25 by late 2019 and remained stable through 2020, reflecting improved leverage with lower debt relative to equity. Early 2021 saw a sharp increase in the ratio to 0.44, likely driven by the noted spike in debt, followed by a decrease to roughly 0.16 by the end of the 2021 period, indicative of significantly strengthened equity relative to debt.

Summary Insights

Over the examined timeframe, the company displayed a notable pattern of managing its capital structure. There were periods marked by increased leveraging, especially in late 2018 and early 2021, which were followed by phases of deleveraging. The steady rise in stockholders’ equity throughout the years indicates improved financial strength, with an exceptional increase toward the end of the last reported period. The reduction in the debt to equity ratio towards the end suggests a strategic focus on strengthening the equity base and reducing financial risk.

The financial data reveals several notable trends in the company's leverage and equity dynamics over the observed quarterly periods.

Total debt (including operating lease liability)

The total debt demonstrates an overall upward trajectory, increasing from approximately $1.25 billion in early 2017 to around $2.47 billion by the last reported quarter in late 2021. Noteworthy fluctuations include a significant increase between mid-2018 and early 2019, peaking near $2.46 billion, followed by a decline toward mid-2019. Subsequently, the debt remains relatively stable through 2020, before a marked rise to $2.82 billion in early 2021, then a modest decline towards the end of 2021.

Total stockholders’ equity

Stockholders’ equity shows a consistent growth pattern throughout the timeframe, growing from $2.55 billion in early 2017 to more than $10.5 billion by late 2021. The equity mostly increases steadily each quarter, with notable acceleration beginning in 2021, where equity values more than double from the prior levels, indicating significant capital accumulation or asset revaluation events during this period.

Debt to equity ratio (including operating lease liability)

This ratio reflects the relationship between the company’s debt and equity and presents some volatility over the period. Initially, the ratio hovers around 0.45 to 0.50, indicating moderate leverage. There is a transient increase to a peak of 0.62 in early 2019, coinciding with the rise in total debt during that period. Afterward, the ratio declines steadily to about 0.39-0.40 through 2020, reflecting a relative increase in equity vis-à-vis debt. A spike to 0.57 occurs in early 2021, possibly due to the sharp rise in debt, but the ratio falls sharply to 0.23 by late 2021, primarily driven by the substantial equity growth. This suggests a significant strengthening of the company’s capital structure, with equity outpacing debt considerably at the end of the reported period.

Overall, the analysis highlights a company that has increased both debt and equity over time, with equity growth outstripping debt increases significantly in the most recent quarters, resulting in a more conservative leverage position by the end of the period. The debt-to-equity ratio’s fluctuations further emphasize shifts in financing strategies and capital structure adjustments during the observed years.

The analysis of the quarterly financial data reveals several notable trends related to the company's debt and capital structure over the observed periods.

Total Debt

Total debt shows a generally fluctuating pattern over the quarters. It initially increases from approximately 1,248 million USD to a peak of 1,997 million USD around late 2018, followed by a decline to a low point near 1,120 million USD by mid-2019. Subsequently, total debt maintains a relatively stable level near 1,150 million USD until late 2020, before rising sharply again to 2,160 million USD in early 2021 and then decreasing to approximately 1,687 million USD by the last quarter.

Total Capital

Total capital demonstrates a consistent upward trajectory over the entire period with only minor fluctuations. It increases from around 3,799 million USD in early 2017 to about 7,082 million USD in mid-2021, followed by a sharp rise to 12,280 million USD at the final data point. This growth indicates a substantial expansion in overall capital resources over the timeframe.

Debt to Capital Ratio

The debt to capital ratio exhibits notable variability, starting at approximately 0.33 in early 2017. It decreases steadily through mid-2019 to a low near 0.20, reflecting a reduction in leverage relative to total capital. The ratio remains stable around 0.20 through late 2020, then experiences a spike up to 0.30 in mid-2021, followed by a significant decline to 0.14 in the last quarter, indicating a relative decrease in debt proportion within the capital structure.

Overall, the data suggest that while total debt has seen periods of both increase and decrease, total capital has grown substantially over the period, leading to a general trend of reduced leverage as reflected in the declining debt-to-capital ratio toward the end of the dataset. The recent fluctuations in debt and corresponding ratio may indicate strategic changes in financing or capital management during the latest quarters.

The analysis of the quarterly financial data reveals several notable trends in the capital structure and leverage of the company over the reported periods.

Total Debt (including operating lease liability)

The total debt shows a general upward trend from April 2017 through October 2021, beginning at approximately $1.25 billion and rising to around $2.47 billion. There are fluctuations within this period, with a peak near the end of 2018 reaching close to $2 billion, followed by some decline in 2019 and 2020 before rising again sharply in early 2021.

Total Capital (including operating lease liability)

The total capital exhibits consistent growth over the same period, starting at about $3.8 billion in early 2017 and reaching a significant peak of approximately $13.1 billion by the last reported quarter in October 2021. This indicates substantial expansion in the company's capital base overall, with the most notable increase occurring in 2021.

Debt to Capital Ratio (including operating lease liability)

The debt to capital ratio fluctuates modestly over the period but remains generally within a range of about 0.28 to 0.38 for most quarters. Initially starting near 0.33, it decreases gradually through 2019 and 2020, indicating a modest reduction in leverage relative to total capital. A marked change occurs in 2021 where the ratio declines sharply to 0.19 by the final quarter, despite increases in absolute debt. This suggests that the growth in total capital significantly outpaced the growth in debt, improving the company's capital structure in terms of lower relative leverage.

Overall, the company’s financial leverage shows a pattern of managed debt growth alongside a stronger increase in total capital, particularly toward the end of the period analyzed. The decreased debt-to-capital ratio in 2021 hints at a more conservative or strengthened financial position relative to its capital base, despite the increase in nominal debt levels. This could reflect efforts to bolster equity or other capital components during that time frame.

The total debt of the company demonstrated an overall increasing trend from April 2017 to October 2021, with notable fluctuations during this period. Beginning at US$1,248 million in April 2017, total debt rose steadily through 2017 and mid-2018, reaching approximately US$1,997 million by the end of 2018. Subsequently, a significant decrease took place throughout 2019, with debt levels falling to around US$1,120 million by June 2019, maintaining a relatively stable range near this level until the end of 2020. In 2021, total debt surged again sharply, peaking at US$2,160 million in April 2021, before decreasing to US$1,687 million by October 2021.

Total assets exhibited a consistent upward trajectory over the examined quarters. From US$4,598 million in April 2017, total assets gradually increased, surpassing US$7 billion by the end of 2019 and continuing to grow to the highest point of US$15,063 million in October 2021. The asset growth was steady, with minor periods of slower increase but no periods of decline observed.

The debt-to-assets ratio reflected variations aligned with the independent movements of total debt and assets. Initially, the ratio showed a moderate decline from 0.27 in April 2017 to a low of 0.23 by mid-2018, indicating a relatively stronger growth in assets relative to debt. A rise in the ratio was observed toward the end of 2018, reaching 0.29, coinciding with increased debt levels and asset accumulation. A pronounced improvement occurred during 2019 and 2020, with the ratio stabilizing around 0.16, representing lower leverage and a more conservative debt structure in proportion to assets. In 2021, a sharp rise in the ratio to 0.25 in April was noted, later falling to 0.11 by October, reflecting volatile debt changes against rapidly increasing assets during this period.

Total Debt

Increased from US$1.25 billion to peaks over US$2.1 billion, with a mid-term decline around 2019.

Total Assets

Consistently grew from US$4.6 billion to over US$15 billion, signifying strong asset base expansion.

Debt to Assets Ratio

Fluctuated between 0.11 and 0.29, suggesting varying leverage levels, with the most recent trend indicating reduced leverage despite high debt levels.

Total Debt

The total debt including operating lease liability exhibited a gradual increase from the start of the period, rising from 1,248 million USD in early April 2017 to a peak of 2,824 million USD by early April 2021. This growth was somewhat uneven, with a significant surge observed between mid-2018 and early 2019, where total debt jumped from 1,369 million USD to approximately 2,461 million USD. After a decline in the middle of 2019, the debt level stabilized around the 1,800 million USD mark for the remainder of 2019 and 2020, before increasing sharply again towards the end of the period, reaching 2,471 million USD in October 2021.

Total Assets

Total assets followed a generally upward trend throughout the observed quarters. Beginning at 4,598 million USD in April 2017, assets steadily increased, reaching 7,585 million USD by December 2020. There was a noticeable jump in total assets during the final quarters, with a substantial increase to 15,063 million USD by October 2021. This marked rise suggests significant asset acquisition or growth activities in the latter part of the timeline.

Debt to Assets Ratio

The debt to assets ratio demonstrated variability but overall a declining trend towards the end of the period. Initially, the ratio modestly decreased from 0.27 to 0.23 in mid-2018, then sharply increased to 0.33 in early 2019, corresponding with the earlier noted surge in debt relative to assets. Following this spike, the ratio fell and stabilized around 0.25 through 2019 and 2020. Most notably, there was a significant reduction in the ratio to 0.16 by October 2021, reflecting the considerable increase in total assets outpacing the rise in total debt during the same period.

Summary of Trends and Insights

The company experienced steady growth in both debt and assets over the examined quarters, with the latter part of the period marking especially rapid asset expansion. While total debt increased, the proportion of debt relative to assets diminished significantly by the end of the timeline, indicating an improved asset base and potentially stronger financial stability. The fluctuations in debt to assets ratio suggest periods of increased leverage, especially in early 2019, but the recent data points imply a strategic move towards a more conservative capital structure or enhanced asset accumulation.

The analysis of the quarterly financial data reveals several noteworthy trends in the company's financial position from early 2017 through late 2021.

Total Assets

Total assets exhibited a consistent upward trajectory throughout the period, increasing from approximately 4,598 million USD in the second quarter of 2017 to a substantial 15,063 million USD by the fourth quarter of 2021. The growth was generally steady, with occasional acceleration particularly noticeable in the final two reported quarters, where asset value surged significantly, indicating notable expansions or acquisitions.

Total Stockholders’ Equity

Stockholders' equity also increased steadily, moving from 2,551 million USD in early 2017 to over 10,593 million USD by late 2021. This reflects a strengthening equity base which supports the overall asset growth. The progression in equity was relatively stable, with slight fluctuations in mid-2019 and mid-2020, but the overall direction remained positive, indicating retention of earnings, possible issuance of equity, or capital appreciation contributing to the enhanced equity position.

Financial Leverage

The financial leverage ratio, representing the proportion of total assets to stockholders’ equity, demonstrated a modest decline over time. Starting at roughly 1.8 in early 2017, the ratio hovered around this level with some fluctuations, reaching a low of about 1.42 in late 2021. This decline signifies a relative reduction in reliance on debt or liabilities compared to equity, suggesting an improving capital structure and potentially lower financial risk.

In summary, the data portray a company that has expanded its asset base considerably over the reported quarters, accompanied by a commensurate increase in equity. The decreasing trend in financial leverage further suggests a shift towards a more equity-financed balance sheet, which may enhance financial stability and creditworthiness. Overall, the financial position appears to have strengthened robustly over the period under review.

The Earnings Before Interest and Tax (EBIT) exhibited notable fluctuations over the reported periods. Initially, there was a strong EBIT value of 511 million US dollars in April 2017, followed by a sharp decline to 149 million by July 2017. Subsequent quarters showed a recovery and stabilization around the 200 to 300 million range, with occasional peaks such as 361 million in June 2019 and 434 million in October 2021. However, there were intermittent decreases, notably toward the end of 2019 and in the mid-2020 period. Overall, the EBIT trend indicates variability with phases of recovery and growth particularly in the latter half of the timeline.

Interest expense remained relatively stable with minor variations across the periods. The values mostly hovered between 8 and 20 million US dollars, with an increasing trend from mid-2017 to end-2018, reaching a peak of 20 million, then fluctuating slightly but generally maintaining a moderate level through to October 2021. This indicates a somewhat controlled interest cost environment with modest increases potentially linked to changes in debt or interest rates.

The interest coverage ratio, calculated as EBIT divided by interest expense, showed a declining trend over time, reflecting the relative changes between EBIT and interest obligations. Starting from a high ratio of around 30 in early 2017, the coverage ratio dropped steadily to approximately 15 by late 2018 and 2019, briefly improving to over 22 at the end of 2019, then declining again during 2020 and stabilizing roughly between 15 and 18 through 2021. This declining trend suggests a decreasing margin of safety for meeting interest payments, despite EBIT growth in some quarters, likely influenced by increased interest expenses or uneven EBIT performance.

Key Observations:

The EBIT values demonstrate a fluctuating but generally positive trend with intermittent peaks and troughs, indicating cyclical or operational influences on profitability before interest costs.

Interest expenses are relatively steady with modest increases, which could point to incremental borrowing or rising interest rates, impacting financial expenses.

The interest coverage ratio’s downward trajectory implies reduced cushion to cover interest expenses, signaling a potential increase in financial risk or tighter earnings margin against debt servicing costs over time.