Advanced Energy Industries Inc (AEIS)
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 | 1.88 | 2.23 | 1.87 | 2.09 | 2.02 |
Based on the provided data for Advanced Energy Industries Inc, it is evident that the company maintains a strong solvency position as indicated by its consistently low debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio, all of which are reported as 0.00 over the five-year period from 2020 to 2024.
Additionally, the financial leverage ratio of the company shows a slight variation over the period, with values ranging from 1.87 to 2.23. This indicates that the company's level of financial leverage has fluctuated but generally remains within a reasonable range.
Overall, the solvency ratios suggest that Advanced Energy Industries Inc has a conservative capital structure with minimal debt obligations relative to its assets, capital, and equity. This implies that the company is effectively managing its financial risk and is in a stable financial position to meet its obligations and support its operations.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 3.09 | 6.86 | 34.00 | 31.71 | 32.89 |
The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. Advanced Energy Industries Inc's interest coverage ratio has shown a consistently strong performance from 2020 to 2022, with values of 32.89, 31.71, and 34.00 respectively, indicating the company's robust ability to meet its interest obligations. However, there was a notable decline in the interest coverage ratio for the years 2023 and 2024, to 6.86 and 3.09 respectively.
The significant decrease in the interest coverage ratio for 2023 and 2024 raises concerns about the company's ability to cover its interest expenses with its operating income. This decline may be attributed to various factors such as increased interest expenses, lower operating income, or a combination of both.
Overall, while Advanced Energy Industries Inc has demonstrated strong interest coverage ratios in the past, the recent downward trend raises a red flag and necessitates further investigation into the company's financial health and sustainability in meeting its interest obligations.