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LinkedIn Corp  (NYSE:LNKD) Cash-to-Debt: 2.90 (As of Sep. 2016)

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. LinkedIn Corp's cash to debt ratio for the quarter that ended in Sep. 2016 was 2.90.

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, LinkedIn Corp could pay off its debt using the cash in hand for the quarter that ended in Sep. 2016.

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Cash-to-Debt 10,000.00 10,000.00 10,000.00 3.18 2.77

 Dec11 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Cash-to-Debt 2.77 2.77 2.78 2.88 2.90

Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.

Calculation

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 & Capital Lease Obligation. This ratio measures the financial strength of a company. This ratio is updated quarterly.

LinkedIn Corp's Cash to Debt Ratio for the fiscal year that ended in Dec. 2015 is calculated as:

 Cash to Debt Ratio = Cash, Cash Equivalents, Marketable Securities / Total Debt = Cash, Cash Equivalents, Marketable Securities / (Current Portion of Long-Term Debt + Long-Term Debt & Capital Lease Obligation) = 3119.382 / (0 + 1126.534) = 2.77

LinkedIn Corp's Cash to Debt Ratio for the quarter that ended in Sep. 2016 is calculated as:

 Cash to Debt Ratio = Cash, Cash Equivalents, Marketable Securities / Total Debt = Cash, Cash Equivalents, Marketable Securities / (Current Portion of Long-Term Debt + Long-Term Debt & Capital Lease Obligation) = 3364.996 / (0 + 1162.141) = 2.90

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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