AeroVironment Inc (AVAV)
Solvency ratios
| Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | Apr 30, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.02 | 0.15 | 0.19 | 0.20 | 0.00 |
| Debt-to-capital ratio | 0.02 | 0.19 | 0.23 | 0.23 | 0.00 |
| Debt-to-equity ratio | 0.02 | 0.23 | 0.29 | 0.31 | 0.00 |
| Financial leverage ratio | 1.23 | 1.50 | 1.50 | 1.52 | 1.15 |
The solvency ratios of AeroVironment Inc reflect the company's ability to meet its long-term financial obligations.
1. Debt-to-assets ratio:
- The trend shows a consistent decrease from 0.20 in 2021 to 0.02 in 2024.
- This indicates a lower reliance on debt to finance the company's assets, which is a positive sign for solvency.
2. Debt-to-capital ratio:
- The trend is also declining from 0.23 in 2021 to 0.02 in 2024.
- This suggests that the company is using less debt relative to its total capital, improving its financial stability.
3. Debt-to-equity ratio:
- Similar to the other ratios, the debt-to-equity ratio has decreased steadily from 0.31 in 2021 to 0.02 in 2024.
- This indicates a stronger equity position, reducing the financial risk associated with high debt levels.
4. Financial leverage ratio:
- The financial leverage ratio peaked in 2021 at 1.52, but has since decreased to 1.23 in 2024.
- While still relatively high, the decreasing trend indicates a more conservative use of debt to finance the company's operations.
Overall, AeroVironment Inc's solvency ratios have shown consistent improvement over the years, with decreasing debt levels relative to assets, capital, and equity. This trend suggests a healthier financial position and improved ability to meet long-term obligations.
Coverage ratios
| Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | Apr 30, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 71.18 | -211.44 | -12.53 | 298.71 | 221.29 |
The interest coverage ratio for AeroVironment Inc has shown significant fluctuations over the past five years. In April 2024, the interest coverage ratio was 71.18, indicating that the company's operating income was sufficient to cover its interest expenses over 71 times. This is a positive sign for creditors as it shows the company's ability to meet its interest obligations comfortably.
However, in April 2023, the interest coverage ratio was -211.44, indicating that the company's operating income was not enough to cover its interest expenses, which raises concerns about its financial health and ability to meet its debt obligations.
Similarly, in April 2022, the interest coverage ratio was -12.53, reflecting a continued struggle to cover interest expenses with operating income. This ratio improved significantly in April 2021 to 298.71, indicating a strong ability to cover interest expenses, which may have been influenced by a particular event or financial management decision.
In April 2020, the interest coverage ratio was 221.29, indicating a robust ability to cover interest expenses with operating income. Overall, the company has experienced volatile fluctuations in its interest coverage ratio, with periods of strong and weak coverage. It is important for stakeholders to closely monitor this ratio as it can provide insights into the company's financial stability and ability to service its debt.