audit debt-discipline
Debt discipline — how much debt, can they repay?
When to use
Buffett: "Only when the tide goes out do you discover who's been swimming naked." Assess a company's leverage and ability to service debt.
Quick Start
# Full debt discipline report
audit debt-discipline
# Only last 5 years
audit debt-discipline --years 2020-2024
Command
audit debt-discipline [--years xxxx-yyyy] [--period q1|h1|9m|annual] [--help]
| Parameter | Description | Default |
|---|---|---|
--years |
Year range | All years |
--period |
Fiscal period | annual |
Core Metrics
| Metric | Formula | Meaning |
|---|---|---|
| D/E | Debt-to-equity ratio | |
| D/EBITDA | Years to repay debt | |
| Interest Coverage | Ability to service debt | |
| Net D/E | True leverage after cash |
Where:
Key signals:
- D/E < 0.5 → conservative
- D/E > 1.5 → aggressive
- Net D/E < 0 → net cash company (Buffett favorite)
- Equity < 0 → D/E meaningless (insolvent)
Advisory
Leverage (D/E)
| Status | Threshold |
|---|---|
[+] |
< 0.5 = conservative |
[~] |
0.5-1.5 = moderate |
[-] |
> 1.5 = aggressive |
Interest Coverage
| Status | Threshold |
|---|---|
[+] |
> 5x = safe |
[~] |
2-5x = moderate |
[-] |
< 2x = risky |
Net Cash Company
| Status | Threshold | Threshold |
|---|---|---|
[+] |
Net debt < 0 | Net debt < 0 |
[-] |
Net debt > 0 | Net debt > 0 |
Field IDs
| Name | Industrial | Banking | Insurance |
|---|---|---|---|
| Short Term Debt | balance_sheet:1349 | balance_sheet:2343 | balance_sheet:3339 |
| Long Term Debt | balance_sheet:1358 | balance_sheet:2357 | balance_sheet:3349 |
| Stockholders' Equity | balance_sheet:1371 | balance_sheet:2368 | balance_sheet:3360 |
| Cash and Cash Equivalents | balance_sheet:1304 | balance_sheet:2303 | balance_sheet:3302 |
| Operating Profit | income:1116 | — | — |
| Depreciation & Amortization | income:1110 | income:2122 | income:3123 |
| Non-Operating Interest Expense | income:1119 | — | income:3128 |
| Total Other Finance Costs | income:1120 | — | — |
Industry Routing
| Metric | Industrial | Banking | Insurance |
|---|---|---|---|
| D/E | Computed | Computed | Computed |
| D/EBITDA | Computed | - |
- |
| Interest Coverage | Computed | - |
- |
| Net D/E | Computed | Computed | Computed |
Banking/insurance: EBITDA and Interest Coverage not applicable (net interest model).
Output Example
DEBT DISCIPLINE
TICKER: [US.AAPL - Apple Inc.]
PERIOD: [2020-ANNUAL ~ 2024-ANNUAL]
[-] Leverage (D/E): 1.90 (> 1.5 = aggressive)
[+] Interest Coverage: 28.3x (> 5x = safe)
[-] Net Cash Company: No
Metric D/E D/EBITDA Coverage Net D/E
---------------------------------------------
Mean 1.82 1.7x 26.8x 0.75
Median 1.78 1.6x 25.5x 0.70
Max 2.10 2.2x 30.2x 1.05
Min 1.55 1.3x 23.4x 0.50
CoV 12.0% 18.0% 10.0% 25.0%
Slope 1.20%/yr - - -
R² 72% - 65% -
[DATA]
Period Total Debt Equity D/E D/EBITDA Coverage Net D/E
---------------------------------------------------------------------
2020 ANNUAL 112.44B 65.34B 1.72 1.8x 23.4x 0.87
...