Altair Engineering Inc (ALTR)
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 | 1.69 | 1.92 | 2.11 | 1.89 | 2.19 |
Altair Engineering Inc's solvency ratios indicate a strong financial position with consistently low levels of debt relative to its assets, capital, and equity over the years from 2020 to 2024. The Debt-to-assets ratio, Debt-to-capital ratio, and Debt-to-equity ratio all remain at 0.00 throughout the period, suggesting that Altair Engineering does not rely heavily on debt to fund its operations or growth.
Moreover, the Financial leverage ratio shows a downward trend from 2.19 in 2020 to 1.69 in 2024. This indicates that Altair Engineering has been reducing its dependence on debt to finance its operations and investments, which is a positive sign for the company's financial stability and risk management.
Overall, Altair Engineering Inc's solvency ratios suggest that the company has a solid financial foundation and is effectively managing its debt levels to ensure long-term sustainability and growth.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 6.59 | 3.06 | -5.45 | 0.98 | 1.18 |
Altair Engineering Inc's interest coverage ratio has fluctuated over the years based on the provided data. In December 31, 2020, the interest coverage ratio was 1.18, indicating the company's ability to cover its interest expenses was relatively weak. By December 31, 2021, the interest coverage ratio decreased further to 0.98, suggesting a deterioration in the company's ability to cover its interest payments with operating income.
In a significant negative turn, by December 31, 2022, Altair Engineering Inc's interest coverage ratio plummeted to -5.45. A negative interest coverage ratio indicates that the company's operating income was insufficient to cover its interest expenses, raising concerns about the company's financial stability and ability to meet its debt obligations.
However, there was a notable improvement in the interest coverage ratio by December 31, 2023, where it stood at 3.06, indicating an increase in the company's ability to cover its interest payments. This improvement was further reinforced by December 31, 2024, when Altair Engineering Inc's interest coverage ratio rose to 6.59, demonstrating a significant strengthening of the company's ability to meet its interest obligations with operating income.
Overall, Altair Engineering Inc's interest coverage ratio has exhibited volatility, reflecting varying levels of financial health and debt servicing capabilities over the years analyzed. It is crucial for the company to maintain a healthy interest coverage ratio to ensure financial stability and meet its debt obligations effectively.