Allegion PLC (ALLE)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.37 | 0.52 | 0.47 | 0.47 | 0.48 |
| Debt-to-capital ratio | 0.55 | 0.69 | 0.65 | 0.63 | 0.65 |
| Debt-to-equity ratio | 1.22 | 2.21 | 1.88 | 1.72 | 1.88 |
| Financial leverage ratio | 3.27 | 4.24 | 4.02 | 3.70 | 3.92 |
Based on the solvency ratios of Allegion plc over the past five years, we can observe the following trends:
1. Debt-to-assets ratio: This ratio indicates the proportion of a company's assets that are financed by debt. Allegion's debt-to-assets ratio has remained relatively stable around 0.47 to 0.52 over the past five years, suggesting that around 47% to 52% of the company's assets are financed through debt.
2. Debt-to-capital ratio: This ratio reflects the percentage of a company's capital that is financed by debt. Allegion's debt-to-capital ratio has shown a decreasing trend from 0.69 in 2022 to 0.60 in 2023. This indicates that the company has been relying less on debt to fund its operations and investments.
3. Debt-to-equity ratio: The debt-to-equity ratio demonstrates the extent to which a company is using debt to finance its operations relative to its equity. Allegion's debt-to-equity ratio has fluctuated between 1.53 and 2.22 over the past five years, showing a higher reliance on debt financing compared to equity.
4. Financial leverage ratio: The financial leverage ratio measures the proportion of a company's assets that are financed by debt relative to its equity. Allegion's financial leverage ratio has also seen fluctuations, ranging from 3.27 to 4.24 during the same period. This indicates that the company has been using a significant amount of debt to finance its operations and investments.
Overall, Allegion plc has shown variations in its solvency ratios over the past five years, with different levels of reliance on debt to finance its operations. Investors and stakeholders should consider these trends when evaluating the company's financial health and risk profile.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 7.63 | 7.77 | 11.43 | 8.15 | 9.48 |
Allegion plc's interest coverage ratio has shown consistent performance over the past five years. The ratio has ranged from 7.87 to 10.82 during this period, indicating the company's ability to comfortably cover its interest expenses with its earnings before interest and taxes (EBIT).
The interest coverage ratio of 8.30 for the most recent year (2023) suggests that Allegion plc generated earnings 8.30 times more than its interest expenses, signifying a solid financial position. The steady trend in the interest coverage ratio over the years reflects the company's stability and consistent profitability, which is essential for meeting debt obligations.
Overall, Allegion plc's interest coverage ratio demonstrates a healthy financial condition and indicates the company's capacity to meet its interest payments efficiently, ultimately enhancing its creditworthiness in the eyes of investors and lenders.