American Axle & Manufacturing (AXL)
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 | 8.99 | 8.85 | 8.72 | 12.31 | 15.97 |
American Axle & Manufacturing shows consistent and strong solvency ratios based on the provided data.
- Debt-to-assets ratio has remained at 0.00 consistently from 2020 to 2024. This indicates that the company has zero debt in relation to its total assets, showcasing a low financial risk and sound financial health.
- Debt-to-capital ratio has also maintained a stable 0.00 from 2020 to 2024, implying that the company's capital structure is not reliant on debt financing.
- Debt-to-equity ratio has consistently stood at 0.00 over the same period, demonstrating that the company's debt levels are extremely low as compared to its equity, suggesting a strong financial position.
- The financial leverage ratio has shown a declining trend from 15.97 in 2020 to 8.99 in 2024. This signifies that the company has been reducing its reliance on debt to finance its operations over the years, which is a positive sign for long-term financial stability.
Overall, these solvency ratios indicate that American Axle & Manufacturing has a very strong solvency position with minimal debt levels in relation to its assets, capital, and equity.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 1.34 | 0.88 | 1.38 | 1.51 | -1.94 |
The interest coverage ratio for American Axle & Manufacturing has fluctuated over the past five years. In December 2020, the company's interest coverage was negative at -1.94, indicating that its operating income was not sufficient to cover its interest expenses.
However, there has been an improvement in the following years. By December 2021, the interest coverage ratio increased to 1.51, showing that the company's operating income could cover its interest expenses 1.51 times. This improvement continued into December 2022, with the ratio at 1.38, although it slightly decreased compared to the previous year.
In December 2023, the interest coverage ratio dropped to 0.88, signaling a potential concern as the company's operating income might not be adequate to cover its interest payments. However, American Axle & Manufacturing managed to increase its interest coverage ratio to 1.34 by December 2024, indicating a slight recovery.
Overall, the trend in American Axle & Manufacturing's interest coverage ratio shows fluctuations, with a mix of improvements and declines over the five-year period. It is essential for the company to continue monitoring and managing its interest coverage to ensure it remains sustainable and in line with its financial health objectives.