These projects can include expanding their production capacity or upgrading outdated technology. The companies that can take on the most debt will likely have the strongest cash flow and credit ratings.
This will allow them to borrow money at a lower cost and reduce overall costs. However, there is always a risk that these companies could experience a financial crisis if conditions deteriorate.
Investors should carefully examine a company’s debt levels before investing in its stock. By doing so, they can better assess the risk of investing in its shares and make an informed decision about whether or not to do so.
The World’s Biggest Borrowers
8. Comcast corporation
Comcast is one of the companies with the highest debt in 2022. Comcast’s net debt is $98 billion, and the company has a credit rating of BBB-.
This high level of debt could be a problem for Comcast in the future, as it could limit the company’s ability to borrow money or make investments.
7. Electricité de France SA
Electricit de France SA (EDF) is a French electric utility company, formed on 8 April 1946 due to the nationalization of Electricit de France (EDF), founded in February 1946. It is one of the world’s largest electricity companies and has more than 36 million customers.
The company’s net debt was $104 billion as of December 2022. That figure was up from $93 billion in December 2021.
The company’s high debt is a concern for investors. As a result, Moody’s has downgraded EDF’s credit rating to junk status. The reason for the downgrade is the high level of debt and the fact that EDF doesn’t have enough cash flow to cover its interest payments.
6. Mercedes-Benz AG
Mercedes-Benz AG was founded in 1926 and is headquartered in Stuttgart, Germany. The company is a subsidiary of Daimler AG. Mercedes-Benz AG operates in the automotive industry. The company manufactures passenger cars, trucks, vans, buses, and sports cars. Mercedes-Benz AG has a net debt of $109 billion as of 2022.
This is the highest amount of debt among all companies in the world. The company’s high debt can be attributed to its high capital expenditures.
Mercedes-Benz AG has invested heavily in new products and technologies to keep up with the competition. However, this investment has come at a cost and contributed to the company’s high debt.
5. Deutsche Telekom AG
Deutsche Telekom AG had a net debt of €99 billion, making it the eighth-most indebted company worldwide. Most of this debt is owed to bondholders, with around €73 billion in long-term debt and €11.5 billion in short-term debt.
The company’s annual interest payments are around €5 billion, putting a significant strain on its cash flow. Deutsche Telekom is not the only telecom company with high levels of debt. AT&T Inc., Verizon Communications Inc. and China Mobile Ltd.
All have net debts above $100 billion. However, Deutsche Telekom’s debt is especially concerning because it is much higher as a percentage of its total assets. In comparison, AT&T’s net debt is only about 25% of its total assets, and Verizon’s is about 30%.
4. Verizon Communications
Verizon Communications had the distinction of being one of the most highly indebted companies in the world. With net debt totalling $174 billion, the telecommunications giant was only bested by a few other firms in terms of liabilities.
This may not have been a problem five or ten years ago when interest rates were much higher than they are today. But with borrowing costs at historic lows, Verizon is now paying billions of dollars in annual interest payments. And while the company is still profitable, it may not be able to keep up this level of debt for much longer.
3. AT&T Inc
AT&T Inc. (NYSE: T) is an American multinational conglomerate holding company headquartered in Dallas, Texas. AT&T is the world’s largest telecommunications company. It was founded in 1885 as the Southwestern Bell Telephone Company.
AT&T Inc. has a net debt of $174 billion as of September 30, 2019. The company is scheduled to repay $49 billion of debt in 2020 and $23 billion in 2021. The company has a credit rating of BBB+ from S&P Global Ratings and A3 from Moody’s Investors Service.
2. Volkswagen AG
Volkswagen AG has the highest net debt of any company in the world as of 2022, with a total of $174 billion. This is more than twice the net debt of runner-up Ferrari NV, which is $76 billion. Other companies with high net debt levels include AT&T Inc. ($67 billion) and General Electric Co. ($61 billion).
Net debt is one way to measure a company’s overall financial health, and it consists of two components: long-term debt and shareholder equity. Long-term debt is money that a company has borrowed and must repay over more than one year, while shareholder equity is the value of all the shares in a company that its shareholders own.
1. Toyota Motor Corporation
Toyota Motor Corporation is in a very risky financial situation. The company’s net debt is $186 billion, the highest net debt for any company in the world. This puts Toyota at increased risk for bankruptcy if it experiences major financial setbacks.
The company’s total liabilities are also high, at $269 billion. Toyota has less than $83 billion in assets, which is not much compared to its liabilities. If Toyota’s debt continues to grow, it could be forced to declare bankruptcy within the next few years.