Analog Devices Inc (ADI)
Solvency ratios
| Nov 2, 2024 | Oct 28, 2023 | Oct 29, 2022 | Oct 30, 2021 | Oct 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.14 | 0.12 | 0.13 | 0.12 | 0.24 |
| Debt-to-capital ratio | 0.16 | 0.14 | 0.15 | 0.14 | 0.30 |
| Debt-to-equity ratio | 0.19 | 0.17 | 0.18 | 0.16 | 0.43 |
| Financial leverage ratio | 1.37 | 1.37 | 1.38 | 1.38 | 1.79 |
Analog Devices Inc's solvency ratios indicate a consistent trend of maintaining a strong financial position over the past five years. The debt-to-assets ratio has remained relatively stable, ranging from 0.12 to 0.24, with the latest figure showing improvement at 0.14 as of November 2, 2024. This ratio suggests that only a small portion of the company's assets is financed through debt, indicating a lower risk of financial distress.
Similarly, the debt-to-capital ratio has also shown a consistent and positive trend, decreasing from 0.30 in 2020 to 0.16 in 2024. This indicates that Analog Devices has been successful in reducing its reliance on debt to finance its operations and investments, thereby improving its overall capital structure efficiency.
The debt-to-equity ratio has also displayed a favorable downward trend, declining from 0.43 in 2020 to 0.19 in 2024. This signifies that the company has been progressively reducing its debt levels relative to equity, indicating a stronger financial position and a lower degree of leverage.
Lastly, the financial leverage ratio has remained relatively stable around 1.37 to 1.79 over the five-year period. A consistent financial leverage ratio suggests that Analog Devices has been able to maintain a prudent balance between debt and equity financing, ensuring a healthy capital structure.
Overall, the solvency ratios of Analog Devices Inc reflect a positive financial health with improving debt management and a strong balance sheet position. Maintaining low debt levels relative to assets, capital, and equity indicates the company's ability to meet its financial obligations and navigate potential economic challenges effectively.
Coverage ratios
| Nov 2, 2024 | Oct 28, 2023 | Oct 29, 2022 | Oct 30, 2021 | Oct 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 6.31 | 14.63 | 16.46 | 8.19 | 7.79 |
Analog Devices Inc's interest coverage ratio has fluctuated over the past five years, ranging from a low of 6.31 in November 2, 2024, to a high of 16.46 in October 29, 2022. The interest coverage ratio indicates the company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio suggests that the company is more capable of meeting its interest obligations from its earnings.
The significant variation in the interest coverage ratio over the years could indicate changes in the company's profitability and financial leverage. A higher interest coverage ratio in October 29, 2022, and October 28, 2023, indicates that Analog Devices Inc had stronger earnings relative to its interest expenses during those periods, reflecting better financial health and reduced risk of default.
However, the lower interest coverage ratio in November 2, 2024, compared to previous years could raise concerns about the company's ability to meet its interest payments from its operating earnings. Investors and creditors may monitor this ratio closely to assess the company's financial stability and ability to manage its debt obligations effectively.