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Beam Inc (NYSE:BEAM)
Cash to Debt Ratio
0.14 (As of Dec. 2013)

Cash to Debt Ratio measures the financial strength of a company. It is calculated as a company's cash, cash equivalents, and marketable securities divide by its debt. Beam Inc's cash to debt ratio for the quarter that ended in Dec. 2013 was 0.14.

If Cash to Debt ratio is greater than 1, the company can pay off its debt using the cash in hand. Here we can see, Beam Inc couldn't pay off its debt using the cash in hand for the quarter that ended in Dec. 2013.

Definition

This is the ratio of a company's Cash, Cash Equivalents, Marketable Securities to its debt. The debt includes the Current Portion of Long-Term Debt and Long-Term Debt. This ratio measures the financial strength of a company. This ratio is updated quarterly.

Beam Inc's Cash to Debt Ratio for the fiscal year that ended in Dec. 2013 is calculated as:

 Cash to Debt Ratio = Cash, Cash Equivalents, Marketable Securities / Total Debt = Cash, Cash Equivalents, Marketable Securities / (Short-Term Debt + Long-Term Debt) = 277.2 / (12.8 + 2024.5) = 0.14

Beam Inc's Cash to Debt Ratio for the quarter that ended in Dec. 2013 is calculated as:

 Cash to Debt Ratio = Cash, Cash Equivalents, Marketable Securities / Total Debt = Cash, Cash Equivalents, Marketable Securities / (Short-Term Debt + Long-Term Debt) = 277.2 / (12.8 + 2024.5) = 0.14

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Explanation

If Cash to Debt ratio is greater than 1, the company can pay off its debt using the cash in hand. If it is smaller than 1, it means the company has more debt than the cash in hands. In this case, it is important to look the the company's Interest Coverage. Ben Graham requires that a company must have an Interest Coverage of at least 5.

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Beam Inc Annual Data

 Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 cash2debt 0.09 0.02 0.03 0.05 0.04 0.09 0.20 0.11 0.15 0.14

Beam Inc Quarterly Data

 Sep11 Dec11 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 cash2debt 0.17 0.11 0.05 0.04 0.06 0.15 0.03 0.13 0.08 0.14
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