Brady Corporation (BRC)

The solvency ratios of Brady Corporation provide insights into the company's financial health and its ability to meet its long-term obligations. Looking at the trend over the past five years:

1. Debt-to-assets ratio has shown fluctuations over the years, with a notable increase in 2022 before decreasing again in 2023 and 2024. This ratio indicates the proportion of the company's assets financed by debt, and the recent decrease suggests a lower reliance on debt to fund its operations.

2. Debt-to-capital ratio has followed a similar pattern as the debt-to-assets ratio, indicating the proportion of the company's capital that is funded by debt. The decrease in 2024 compared to 2022 and 2023 suggests a more balanced capital structure.

3. Debt-to-equity ratio has also exhibited fluctuations, with an increase in 2022 followed by a decline in 2023 and 2024. This ratio reflects the level of financial leverage carried by the company, and the recent decreases indicate a lower dependency on debt relative to equity.

4. Financial leverage ratio has shown variability over the years, with a peak in 2022 and subsequent decreases in 2023 and 2024. This ratio measures the company's use of debt to finance its assets, and the recent declines suggest a reduction in financial risk.

Overall, the trend in solvency ratios for Brady Corporation indicates a recent trend towards a more conservative capital structure and reduced reliance on debt financing. These improvements in solvency metrics suggest enhanced financial stability and a better ability to meet long-term obligations.

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Coverage ratios

Brady Corporation's interest coverage has fluctuated over the past five years, ranging from a low of 65.95 in 2020 to a high of 379.19 in 2021. The interest coverage ratio measures the company's ability to meet its interest obligations from its operating income. A higher interest coverage ratio indicates that the company is better positioned to cover its interest expenses.

In 2022, Brady Corporation's interest coverage significantly decreased to 151.45 from the previous year's high point. This suggests that the company's ability to cover its interest payments slightly weakened in 2022 compared to 2021.

The interest coverage ratio further declined in 2023 to 64.77, indicating a significant decrease in the company's ability to cover interest payments. However, by 2024, the interest coverage ratio improved to 80.28, although it has not reached the levels seen in 2021.

Overall, Brady Corporation's interest coverage ratio has shown variations over the years, with a notable decrease in 2023 followed by a slight improvement in 2024. It is essential for stakeholders to monitor this ratio to assess the company's ability to meet its interest obligations and manage its debt effectively.