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General Mills (NYSE:GIS) Degree of Financial Leverage

: -0.94 (As of Nov. 2023)
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Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in Earnings Before Interest and Taxes (EBIT). General Mills's Degree of Financial Leverage for the quarter that ended in Nov. 2023 was -0.94. The higher Degree of Financial Leverage, the more volatile earnings will be.

The industry rank for General Mills's Degree of Financial Leverage or its related term are showing as below:

GIS's Degree of Financial Leverage is ranked better than
90.5% of 1832 companies
in the Consumer Packaged Goods industry
Industry Median: 0.99 vs GIS: -0.94

General Mills Degree of Financial Leverage Historical Data

The historical data trend for General Mills's Degree of Financial Leverage 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.

* Premium members only.

General Mills Annual Data
Trend May14 May15 May16 May17 May18 May19 May20 May21 May22 May23
Degree of Financial Leverage
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -5.80 1.28 0.87 1.82 1.59

General Mills Quarterly Data
Feb19 May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21 Nov21 Feb22 May22 Aug22 Nov22 Feb23 May23 Aug23 Nov23
Degree of Financial Leverage Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3.88 1.37 1.59 -1.16 -0.94

Competitive Comparison

For the Packaged Foods subindustry, General Mills's Degree of Financial Leverage, along with its competitors' market caps and Degree of Financial Leverage data, can be viewed below:

* 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. Note that "N/A" values will not show up in the chart.


General Mills Degree of Financial Leverage Distribution

For the Consumer Packaged Goods industry and Consumer Defensive sector, General Mills's Degree of Financial Leverage distribution charts can be found below:

* The bar in red indicates where General Mills's Degree of Financial Leverage falls into.



General Mills Degree of Financial Leverage Calculation

General Mills's Degree of Financial Leverage for the quarter that ended in Nov. 2023 is calculated as:

Degree of Financial Leverage=% Change in Earnings per Share (Diluted)**/% Change in EBIT
=( 4.11 (Nov. 2023) / 4.79 (Nov. 2022) - 1 )/( 3936 (Nov. 2023) / 3417.8 (Nov. 2022) - 1 )
=-0.142/0.1516
=-0.94***

* 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.

** TTM data of EPS and EBIT was used to calculate Degree of Financial Leverage.
*** Please be aware that the Degree of Financial Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.


General Mills  (NYSE:GIS) Degree of Financial Leverage Explanation

Degree of Financial Leverage (DFL) is a leverage ratio that measures the sensitivity of a company’s Earnings per Share (EPS) to fluctuations in its operating income, also referred to as Earnings Before Interest and Taxes (EBIT), resulting from adjustments in its capital structure. DFL is an essential tool for companies to assess the appropriate level of debt or financial leverage in their capital structure. When EBIT remains relatively stable, it results in stable earnings and earnings per share. In such cases, the company may consider taking on substantial debt. However, for companies operating in industries with significant fluctuations in EBIT, it is advisable to keep debt at a manageable level.

The higher Degree of Financial Leverage, the more volatile earnings will be. Because interest is a fixed expense, leverage can amplify earnings and EPS. This is beneficial when EBIT is growing, but it can become problematic in tough economic conditions when EBIT is under pressure.

Be Aware

The use of financial leverage varies across different industries and business sectors, and the application of Degree of Financial Leverage (DFL) should be adjusted accordingly.


General Mills Degree of Financial Leverage Related Terms

Thank you for viewing the detailed overview of General Mills's Degree of Financial Leverage provided by GuruFocus.com. Please click on the following links to see related term pages.


General Mills (NYSE:GIS) Business Description

Address
Number One General Mills Boulevard, Minneapolis, MN, USA, 55426
General Mills is a global packaged food company that produces snacks, cereal, convenient meals, yogurt, dough, baking mixes and ingredients, pet food, and superpremium ice cream. Its largest brands are Nature Valley, Cheerios, Old El Paso, Yoplait, Pillsbury, Betty Crocker, Blue Buffalo, and Haagen-Dazs. In fiscal 2023, 81% of its revenue was derived from the United States, although the company also operates in Canada, Europe, Australia, Asia, and Latin America. While most of General Mills' products are sold through retail stores to consumers, the company also sells products to the foodservice channel and the commercial baking industry.
Executives
Werner Lanette Shaffer officer: Chief Innovation Officer ONE GENERAL MILLS BLVD., MINNEAPOLIS MN 55426
David Cordani director THE CIGNA GROUP, 900 COTTAGE GROVE ROAD, BLOOMFIELD CT 06002
Mark A Pallot officer: Chief Accounting Officer NUMBER ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Jodi J Benson officer: Chief Innovation Officer GENERAL MILLS, INC., ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Jacqueline Williams-roll officer: Senior Vice President GENERAL MILLS, INC., ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Bethany C. Quam officer: Group President GENERAL MILLS, INC., ONE GENERAL MILLS BLVD., MINNEAPOLIS MN 55426
Jonathon Nudi officer: Senior Vice President GENERAL MILLS, INC., ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Sean N Walker officer: Group President NUMBER ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Shawn P Ogrady officer: SVP, Pres, Consumer Food Sales ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Jeffrey L Harmening officer: Executive Vice President ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Dana M Mcnabb officer: Group President NUMBER ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
C Kim Goodwin director C/O AKAMAI TECHNOLOGIES, INC., 8 CAMBRIDGE CENTER, CAMBRIDGE MA 02142
Karen Wilson Thissen officer: General Counsel & Secretary 1098 AMERIPRISE FINANCIAL CENTER, MINNEAPOLIS MN 55474
John R Church officer: SVP, Supply Chain ONE GENERAL MILLS BLVD, MINNEAPOLIS MN 55426
Richard C Allendorf officer: Senior Vice President GENERAL MILLS, INC., ONE GENERAL MILLS BLVD., MINNEAPOLIS MN 55426