Long-Term Debt & Capital Lease Obligation is the debt and capital lease obligation due more than 12 months in the future. Peloton Interactive's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Mar. 2023 was $2,297 Mil.
LT-Debt-to-Total-Asset is a measurement representing the percentage of a corporation's assets that are financed with loans and financial obligations lasting more than one year. The ratio provides a general measure of the financial position of a company, including its ability to meet financial requirements for outstanding loans. It is calculated as a company's Long-Term Debt & Capital Lease Obligation divides by its Total Assets. Peloton Interactive's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Mar. 2023 was $2,297 Mil. Peloton Interactive's Total Assets for the quarter that ended in Mar. 2023 was $3,016 Mil. Peloton Interactive's LT-Debt-to-Total-Asset for the quarter that ended in Mar. 2023 was 0.76.
Peloton Interactive's LT-Debt-to-Total-Asset
increased
from Mar. 2022 (0.36) to Mar. 2023 (0.76).
It may suggest that Peloton Interactive is progressively becoming more dependent on debt to grow their business.
Peloton Interactive Long-Term Debt & Capital Lease Obligation Historical Data
The historical data trend for Peloton Interactive's Long-Term Debt & Capital Lease Obligation can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
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Peloton Interactive Annual Data
Trend
Jun17
Jun18
Jun19
Jun20
Jun21
Jun22
Long-Term Debt & Capital Lease Obligation
-
-
508.20
1,450.20
2,279.40
Peloton Interactive Quarterly Data
Jun18
Sep18
Dec18
Mar19
Jun19
Sep19
Dec19
Mar20
Jun20
Sep20
Dec20
Mar21
Jun21
Sep21
Dec21
Mar22
Jun22
Sep22
Dec22
Mar23
Long-Term Debt & Capital Lease Obligation
1,591.30
2,279.40
2,366.30
2,323.30
2,297.00
Peloton Interactive Long-Term Debt & Capital Lease Obligation Calculation
Long-Term Debt is the debt due more than 12 months in the future. The debt can be owed to banks or bondholders. Some companies issue bonds to investors and pay interest on the bonds.
Long-Term Capital Lease Obligation represents the total liability for long-term leases lasting over one year. It's amount equal to the present value (the principal) at the beginning of the lease term less lease payments during the lease term.
The interest paid on companies' debt is reflected in the income statement as interest expense. If a company has too much debt and it cannot serve the interest payment on the debt or repay the matured debt, the company risks bankruptcy. Peter Lynch famously said: A company that does not have debt cannot go bankrupt.
A company's long term debt may have different dates of maturity and interest rates, depending on the terms.
Usually a company issues long term debt to pay for its capital expenditures. Borrowing allows the company to do things that otherwise cannot be done with only the capital it has. But debt can be risky.
Peloton Interactive (NAS:PTON) Long-Term Debt & Capital Lease Obligation Explanation
LT-Debt-to-Total-Asset is a measurement representing the percentage of a corporation's assets that are financed with loans and financial obligations lasting more than one year. The ratio provides a general measure of the financial position of a company, including its ability to meet financial requirements for outstanding loans. A year-over-year decrease in this metric would suggest the company is progressively becoming less dependent on debt to grow their business.
Peloton Interactive's LT-Debt-to-Total-Asset ratio for the quarter that ended in Mar. 2023 is calculated as:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Buffett says that durable competitive advantages carry little to no long-term debt because the company is so profitable that even expansions or acquisitions are self financed.
We are interested in long term debt load for the last ten years. If the ten years of operation show little to no long term debt, then the company has some kind of strong competitive advantage.
Warren Buffett's historic purchases indicate that on any given year, the company should have sufficient yearly net earnings to pay all long term within 3 or 4 year earnings period. (e.g. Coke + Moody's = 1yr)
Companies with enough earning power to pay long term debt in less than 3 or 4 years is a good candidate in our search for long term competitive advantage.
BUT, these companies are targets for leveraged buy outs, which saddles the business with long term debt.
If all else indicates the company has a moat, but it has ton of debt, a leveraged buyout may have created the debt. In these cases the company's bonds offer the better bet, in that the companys earnings power is focused on paying off the debt and not growth.
Important: little or no long term debt often means a Good Long Term Bet
Peloton Interactive Long-Term Debt & Capital Lease Obligation Related Terms
Thank you for viewing the detailed overview of Peloton Interactive's Long-Term Debt & Capital Lease Obligation provided by GuruFocus.com. Please click on the following links to see related term pages.
Peloton Interactive (NAS:PTON) Business Description
Peloton Interactive Inc operates an interactive fitness platform. It operates its business in two reportable segments: Connected Fitness Products and Subscription. Connected Fitness Product revenue consists of sales of bike and tread and related accessories, associated fees for delivery and installation, and extended warranty agreements. Subscription revenue consists of revenue generated from monthly Connected Fitness Subscription and Digital Subscription. The company generates the majority of the revenue from the sale of Connected Fitness Products.
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