Asbury Automotive Group Inc (ABG)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 2.95 | 3.13 | 2.76 | 3.78 | 4.06 |
Asbury Automotive Group Inc has consistently maintained a strong solvency position over the years, as evidenced by its low and decreasing debt-to-assets, debt-to-capital, and debt-to-equity ratios, all of which remained at 0.00 from December 31, 2020, to December 31, 2024. This indicates that the company has minimal debt relative to its assets, capital, and equity, signifying a low financial risk and a strong ability to cover its financial obligations.
The financial leverage ratio, which measures the company's reliance on debt financing, shows a decreasing trend from 4.06 in 2020 to 2.95 in 2024. This indicates that Asbury Automotive Group Inc has been reducing its debt levels in proportion to its equity, contributing to a more stable financial structure and reduced financial risk.
Overall, based on these solvency ratios, Asbury Automotive Group Inc appears to have a sound financial position with low debt levels and a decreasing reliance on debt financing over the years, which bodes well for its ability to weather economic downturns and meet its financial obligations.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 3.14 | 5.79 | 7.77 | 7.88 | 5.51 |
Asbury Automotive Group Inc's interest coverage ratio has shown fluctuations over the years as per the provided data. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt.
In 2020, the interest coverage ratio was 5.51, indicating that Asbury Automotive Group Inc generated 5.51 times the earnings needed to cover its interest expense for the year. This implies a moderate level of financial health in terms of meeting interest obligations.
The ratio improved in 2021 to 7.88, showing that the company's ability to cover interest payments increased significantly, reflecting stronger profitability or lower interest expenses during the period.
In 2022 and 2023, the interest coverage ratio remained relatively stable at 7.77 and 5.79, respectively. This suggests that the company maintained a reasonable level of interest coverage despite some fluctuations.
However, there was a notable decrease in the interest coverage ratio to 3.14 in 2024. This decline may raise concerns about the company's ability to meet its interest payments comfortably, as the earnings available for servicing debt have decreased substantially.
Overall, Asbury Automotive Group Inc's interest coverage ratio has exhibited variability, with improvements in some years and a decline in others. Investors and creditors should closely monitor this ratio to assess the company's financial health and ability to manage its debt obligations effectively.