The most indebted companies in 2022 will likely need to invest in new capital projects to stay competitive.
These projects may include expanding their production capacity or upgrading outdated technology. Companies that can take on the most debt are likely to have the strongest cash flow and credit ratings.
This will allow them to borrow money more cheaply and reduce overall costs. However, there is always a risk that these companies will experience a financial crisis if conditions deteriorate.
Investors should carefully consider a company’s debt levels before investing in its stock. By doing so, they can better assess the risk of investing in its stocks and make an informed decision on whether or not to do so.
The biggest borrowers in the world
8. Comcast Company
Comcast is one of the most indebted companies 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. Electricity of France SA
Électricité de France SA (EDF) is a French electricity utility company, created on April 8, 1946 due to the nationalization of Électricité de France (EDF), founded in February 1946. It is one of the most largest electricity companies in the world and has more than 36 million customers.
The company’s net debt was $104 billion in December 2022. This figure was up from $93 billion in December 2021.
The company’s high indebtedness worries investors. As a result, Moody’s downgraded EDF’s credit rating to junk status. The reason for the downgrade is the high level of debt and the fact that EDF does not have enough cash 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 in 2022.
This is the highest amount of debt among any company 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 came at a cost and contributed to the company’s high debt load.
5. Deutsche Telekom AG
Deutsche Telekom AG had a net debt of 99 billion euros, making it the eighth most indebted company in the world. 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 amount to around 5 billion euros, putting a heavy strain on its cash flow. Deutsche Telekom is not the only telecommunications company to be heavily indebted. AT&T Inc., Verizon Communications Inc. and China Mobile Ltd.
All have net debts in excess of $100 billion. However, Deutsche Telekom’s debt is of particular concern as it is much higher as a percentage of its total assets. By comparison, AT&T’s net debt is only about 25% of its total assets and Verizon’s is about 30%.
Verizon Communications had the distinction of being one of the most indebted companies in the world. With a net debt of $174 billion, the telecommunications giant was trailed by only a few other companies in terms of liabilities.
This might 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 business is still profitable, it may not be able to sustain that level of debt any longer.
AT&T Inc. (NYSE:T) is an American multinational conglomerate holding company headquartered in Dallas, Texas. AT&T is the largest telecommunications company in the world. It was founded in 1885 as the Southwestern Bell Telephone Company.
AT&T Inc. has net debt of $174 billion as of September 30, 2019. The company is expected 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 in 2022, totaling $174 billion. That’s more than double the net debt of second-placed Ferrari NV, which stands at $76 billion. AT&T Inc. ($67 billion) and General Electric Co. ($61 billion) are other companies with high net debt levels.
Net debt is a way to measure the overall financial health of a business and it is made up of two components: long-term debt and equity. Long-term debt is money a company has borrowed and needs to repay over more than a year, while equity is the value of all the shares in a company held by its shareholders.
1.Toyota Motor Corporation
Toyota Motor Corporation is in a very risky financial position. The company’s net debt is $186 billion, the highest net debt of any company in the world. This puts Toyota at increased risk of bankruptcy if it suffers 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 a lot compared to its liabilities. If Toyota’s debt continues to grow, it could be forced to declare bankruptcy in the next few years.