The Cheesecake Factory (CAKE)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.15 | 0.17 | 0.17 | 0.17 | 0.10 |
| Debt-to-capital ratio | 0.50 | 0.60 | 0.62 | 0.59 | 0.49 |
| Debt-to-equity ratio | 1.02 | 1.48 | 1.60 | 1.41 | 0.97 |
| Financial leverage ratio | 6.86 | 8.93 | 9.50 | 8.47 | 9.52 |
The Cheesecake Factory's solvency ratios provide insights into the company's ability to meet its long-term financial obligations and manage its debt levels.
1. Debt-to-assets ratio: The trend of this ratio shows an increase from 0.10 in 2020 to 0.17 in 2024. This indicates that a higher proportion of the company's assets are financed by debt over the years.
2. Debt-to-capital ratio: This ratio also exhibits an upward trend, rising from 0.49 in 2020 to 0.50 in 2024. The ratio suggests that the company's capital structure is becoming more leveraged with each passing year.
3. Debt-to-equity ratio: The trend of this ratio is characterized by fluctuations, from 0.97 in 2020 to 1.02 in 2024 with peaks in between. This indicates that the company is relying more on debt financing relative to equity, which could increase financial risk.
4. Financial leverage ratio: The financial leverage ratio has decreased from 9.52 in 2020 to 6.86 in 2024. A decreasing trend in this ratio signifies that the company has reduced its reliance on debt to finance its operations and investments.
Overall, these solvency ratios reflect The Cheesecake Factory's changing capital structure and debt management strategies over the years. Investors and analysts may closely monitor these ratios to assess the company's financial health and risk profile.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | — | — | — | — | -434.30 |
The interest coverage ratio for The Cheesecake Factory is a crucial metric used to assess the company's ability to meet its interest obligations.
As per the data provided, the interest coverage for The Cheesecake Factory is reported as negative 434.30 as of December 31, 2020. A negative interest coverage ratio indicates that the company's earnings before interest and taxes (EBIT) are insufficient to cover its interest expenses, suggesting a potential financial risk.
However, the data for the subsequent years (2021, 2022, 2023, and 2024) is denoted as "—," which implies that the specific values for interest coverage for those years are not available in the dataset provided.
Having a negative interest coverage ratio can signal financial distress and may raise concerns among investors and creditors about the company's ability to repay its debt obligations. It is essential for The Cheesecake Factory to closely monitor and improve its interest coverage ratio to ensure its financial health and sustainability in the long term.