Corporate America Is In Fantastic Financial Shape
Two measures of business debt levels have plunged to multi-year lows since the financial crisis.
Deutsche Bank's David Bianco published two charts in a research note Sunday that show how much S&P 500 companies (excluding financials) have deleveraged their balance sheets, or reduced their debt.
First,the percentage of net sales that companies use to pay interest accrued on their debt, or the interest expense to sales ratio, has fallen significantly. According to the chart, its at the lowest level since the start of the great inflation of the 1970s.
Similarly, there's been a decline in the net debt to market cap ratio, which is how liabilities compare to market cap.
Deutsche Bank
- T20 World Cup: Majority of Indian players to leave for New York on May 25
- India, UK reaffirm FTA commitment at Strategic Dialogue
- IPL 2024: Will rain play spoilsport in much-awaited blockbuster CSK vs RCB clash?
- Singapore seeing new COVID-19 wave, minister advises wearing of masks
- Impact Player rule has disrupted balance of game: Virat Kohli