Allegiant Travel Company (ALGT)

The solvency ratios of Allegiant Travel Company provide insights into the company's ability to meet its long-term financial obligations.

1. Debt-to-assets ratio:
- The trend shows a slight decrease from 0.44 in 2020 to 0.36 in 2024. This indicates that the company has been reducing its reliance on debt to finance its assets over the years.

2. Debt-to-capital ratio:
- There is a decreasing trend from 0.67 in 2020 to 0.60 in 2024. This suggests that Allegiant Travel Company has been reducing its debt relative to its total capital structure.

3. Debt-to-equity ratio:
- The debt-to-equity ratio has shown fluctuations, starting at 2.06 in 2020, decreasing to 1.32 in 2021, and then hovering around 1.37 to 1.59 in the following years. This indicates that the company has been managing its debt levels in relation to shareholder equity.

4. Financial leverage ratio:
- The financial leverage ratio shows a decline from 4.66 in 2020 to 3.26 in 2021, then fluctuating between 3.66 and 4.07 in the subsequent years. This ratio measures the proportion of a company's assets that finance operations through debt. The fluctuations in this ratio suggest changes in the company's overall financial risk.

Overall, based on the solvency ratios, Allegiant Travel Company appears to be effectively managing its debt levels and gradually improving its solvency position over the years. However, further analysis may be necessary to fully understand the company's financial health and capacity to meet its long-term obligations.

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Coverage ratios

Based on the provided data, the interest coverage ratio for Allegiant Travel Company has shown some fluctuations over the years.

As of December 31, 2020, the interest coverage ratio was -4.85, indicating that the company's earnings before interest and taxes were insufficient to cover its interest expenses, which raises a concern about its ability to meet its debt obligations.

However, by December 31, 2021, the interest coverage ratio improved to 3.87, suggesting that the company's earnings were more than sufficient to cover its interest expenses, which is a positive sign for its financial health.

The ratio then decreased to 1.04 by December 31, 2022, indicating a decrease in the ability of the company to cover its interest expenses from its earnings. This could imply potential financial risk or a need to reassess its debt management strategies.

By December 31, 2023, the interest coverage ratio increased to 2.04, showing a slight improvement in covering interest expenses, but still relatively low compared to previous years.

Lastly, as of December 31, 2024, the interest coverage ratio fell to -0.97, once again indicating a potential inability to cover interest expenses with earnings. This may raise concerns about the company's financial stability and ability to service its debt obligations.

In conclusion, Allegiant Travel Company's interest coverage ratio has shown volatility over the years, with periods of improvement and decline. It is important for investors and stakeholders to closely monitor the company's financial performance and debt management practices to assess its ability to meet its interest payments in the long term.