Artivion Inc (AORT)

Artivion Inc's solvency ratios provide insights into the company's ability to meet its long-term financial obligations.

The debt-to-assets ratio has fluctuated between 0.37 to 0.41 over the past five years, indicating that the company has maintained a relatively stable level of debt compared to its total assets. A lower ratio suggests lower financial risk as it indicates a lower reliance on debt financing.

The debt-to-capital ratio has also shown consistency, ranging from 0.44 to 0.52. This ratio reflects the proportion of the company's capital structure funded by debt, with the remaining portion funded by equity. Artivion Inc's moderate debt-to-capital ratio signifies an appropriate balance between debt and equity financing.

The debt-to-equity ratio has increased gradually from 0.78 in 2019 to 1.10 in 2023, indicating a higher reliance on debt to finance its operations in recent years. A higher debt-to-equity ratio could signal potential financial risk, as it implies a higher level of debt relative to equity.

The financial leverage ratio has also shown an upward trend, increasing from 2.12 in 2019 to 2.81 in 2023. This ratio measures the company's financial risk by assessing the proportion of total assets funded by debt. The rising trend suggests that Artivion Inc has been using more debt to finance its assets, which may lead to increased financial risk.

Overall, while Artivion Inc has maintained relatively stable debt-to-assets and debt-to-capital ratios, the increasing trend in the debt-to-equity and financial leverage ratios over the years indicates a growing reliance on debt financing, which could potentially increase the company's financial risk and impact its solvency in the long run.

---

Coverage ratios

Artivion Inc's interest coverage ratio has fluctuated significantly over the past five years. The ratio was negative in three out of the five years, indicating that the company's earnings were insufficient to cover its interest expenses during those periods. In particular, the interest coverage ratio was notably low at -0.35 in 2023, -0.46 in 2021, and 0.15 in 2020, suggesting a higher risk of default on interest payments.

Although the ratio improved to 0.34 in 2022 and 1.20 in 2019, it still indicates that the company's ability to meet its interest obligations was relatively weak in those years as well. A consistent positive interest coverage ratio above 1 is generally preferred, as it signifies that the company is generating enough operating income to comfortably cover its interest expenses.

Given the fluctuating and often inadequate interest coverage ratios, it is essential for Artivion Inc to focus on improving its profitability and cash flow generation to enhance its ability to service its debt obligations. Further analysis of the company's operating performance and financial health would be necessary to determine the underlying reasons for the fluctuating interest coverage ratios and to formulate appropriate strategies for improving the company's financial stability.