Advance Auto Parts Inc (AAP)

Solvency ratios

Dec 31, 2023 Oct 7, 2023 Jul 15, 2023 Apr 22, 2023 Dec 31, 2022 Oct 8, 2022 Apr 23, 2022 Dec 31, 2021 Oct 9, 2021 Jul 17, 2021 Apr 24, 2021 Dec 31, 2020 Sep 30, 2020 Jul 11, 2020 Apr 18, 2020 Dec 31, 2019 Oct 5, 2019 Jul 13, 2019 Apr 20, 2019 Dec 31, 2018
Debt-to-assets ratio 0.15 0.12 0.14 0.15 0.10 0.08 0.00 0.08 0.09 0.09 0.09 0.09 0.09 0.11 0.11 0.07 0.07 0.07 0.07 0.12
Debt-to-capital ratio 0.41 0.37 0.39 0.41 0.31 0.27 0.00 0.25 0.26 0.25 0.23 0.22 0.23 0.27 0.27 0.17 0.18 0.17 0.17 0.23
Debt-to-equity ratio 0.71 0.59 0.65 0.70 0.46 0.37 0.00 0.33 0.35 0.34 0.30 0.29 0.30 0.36 0.36 0.21 0.22 0.20 0.21 0.29
Financial leverage ratio 4.87 4.77 4.65 4.75 4.61 4.46 4.13 3.90 3.71 3.59 3.39 3.33 3.18 3.20 3.41 3.17 3.21 3.07 3.12 2.55

The solvency ratios of Advance Auto Parts Inc have shown consistent performance over the past few years. The debt-to-assets ratio has ranged between 0.08 and 0.15, indicating that the company has maintained a relatively conservative level of debt compared to its total assets.

Similarly, the debt-to-capital ratio has ranged between 0.22 and 0.41, showing that Advance Auto Parts has been effectively managing its capital structure with a mix of debt and equity. The debt-to-equity ratio has also exhibited stability, ranging from 0.29 to 0.71, signaling that the company has not been overly leveraged.

The financial leverage ratio, which measures the company's overall debt levels compared to its equity, has been consistently around 3.0 to 4.8. This suggests that Advance Auto Parts has maintained a moderate level of financial leverage, balancing its debt obligations with equity capital.

Overall, based on the solvency ratios analyzed, Advance Auto Parts Inc appears to have a sound financial position with a manageable level of debt relative to its assets, capital, and equity.

Coverage ratios

Dec 31, 2023 Oct 7, 2023 Jul 15, 2023 Apr 22, 2023 Dec 31, 2022 Oct 8, 2022 Apr 23, 2022 Dec 31, 2021 Oct 9, 2021 Jul 17, 2021 Apr 24, 2021 Dec 31, 2020 Sep 30, 2020 Jul 11, 2020 Apr 18, 2020 Dec 31, 2019 Oct 5, 2019 Jul 13, 2019 Apr 20, 2019 Dec 31, 2018
Interest coverage 3.91 9.94 20.22 22.73 17.06 23.60 43.18 45.85 49.10 42.68 43.52 35.34 36.65 39.30 33.64 41.60 29.66 23.69 23.57 23.20

Interest coverage is a key financial ratio that measures a company's ability to make interest payments on its debt obligations. It is calculated by dividing earnings before interest and taxes (EBIT) by interest expenses. A higher interest coverage ratio indicates a company is more capable of servicing its debt.

Looking at the interest coverage trend of Advance Auto Parts Inc over the past few years, we observe fluctuations in the ratio. The interest coverage ratio has generally been at healthy levels, with values well above 1 in all periods, indicating that the company's operating income is sufficient to cover its interest expenses.

In the most recent period of Dec 31, 2023, the interest coverage ratio stands at 3.91, which is lower compared to the previous period, suggesting a decrease in the company's ability to cover its interest payments. However, it is important to note that a ratio above 1 still indicates the company's ability to meet its interest obligations.

The peak in the interest coverage ratio was observed in Dec 31, 2021, with a value of 45.85, showing a very strong ability to cover interest expenses. This high ratio continued in subsequent periods, indicating robust financial health and capacity to service debt.

Overall, based on the historical trend of Advance Auto Parts Inc's interest coverage ratio, the company has shown good financial stability and management of its debt obligations. Investors and stakeholders can monitor this ratio going forward to assess the company's ability to meet its interest payments amidst changing economic conditions.