ADMA Biologics Inc (ADMA)

The solvency ratios of ADMA Biologics Inc indicate the company's ability to meet its long-term financial obligations and the extent to which it relies on debt financing.

The debt-to-assets ratio has fluctuated over the past five years, ranging from 0.34 to 0.54. This ratio indicates that, on average, between 34% and 54% of the company's assets are financed by debt. The decreasing trend from 2020 to 2023 suggests improving asset coverage by equity.

The debt-to-capital ratio reflects the proportion of a company's capital structure that is financed by debt. ADMA Biologics Inc's debt-to-capital ratio has also varied, with values between 0.40 and 0.72, indicating that debt has comprised between 40% and 72% of the company's total capital over the years. The decreasing trend from 2020 to 2023 suggests a shift towards a relatively lower reliance on debt for capital financing.

The debt-to-equity ratio, which compares a company's total debt to its total equity, peaked at 2.61 in 2019 and has since decreased to 0.97 in 2023. This reduction indicates a significant improvement in the company's solvency position and a lower level of financial risk associated with high debt levels.

The financial leverage ratio, which measures the proportion of a company's total assets that are financed by debt, has shown a declining trend from 4.85 in 2019 to 2.43 in 2023. This indicates that ADMA Biologics Inc has reduced its reliance on debt financing relative to its total assets, demonstrating a stronger financial position and potentially lower default risk.

Overall, the solvency ratios of ADMA Biologics Inc demonstrate improvements over the years, with decreasing trends in debt-related ratios suggesting a more sustainable capital structure and enhanced financial stability.

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Coverage ratios

The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher ratio indicates stronger ability to meet interest obligations.

Over the past five years, ADMA Biologics Inc has shown consistently low interest coverage ratios, ranging from -0.13 to -4.49. The negative ratios indicate that the company's operating income was insufficient to cover its interest expenses during these years.

The declining trend in interest coverage ratios over the years raises concerns about the company's financial health and its ability to service its debt obligations. A ratio below 1 indicates that the company is not generating enough operating income to cover its interest expenses, which could potentially lead to financial distress and default on debt payments.

Overall, the consistently low and negative interest coverage ratios suggest that ADMA Biologics Inc may face challenges in managing its debt and may need to improve its operational performance to enhance its ability to cover interest expenses in the future.