The Cheesecake Factory (CAKE)

The solvency ratios of The Cheesecake Factory indicate the company's ability to meet its long-term financial obligations and the extent to which it relies on debt financing.

The Debt-to-assets ratio shows the proportion of the company's assets financed by debt. The ratio was consistently low or zero over the period, indicating that the company relies less on debt to finance its operations and acquisitions.

The Debt-to-capital ratio measures the percentage of total capital that is financed by debt. The ratios decreased from 60% in December 2023 to 50% in December 2024, showing a slight reduction in the reliance on debt for funding operations.

The Debt-to-equity ratio reflects the proportion of equity and debt in the company's capital structure. The ratios were relatively high, indicating a higher reliance on debt compared to equity for financing, but they declined over time, suggesting an improvement in the company's overall solvency.

The Financial leverage ratio, which indicates how much the company relies on debt in comparison to equity, decreased significantly from 9.50 in January 2023 to 6.86 in January 2025. This decrease suggests that the company has been reducing its financial leverage and becoming less reliant on debt to fund its operations.

Overall, The Cheesecake Factory's solvency ratios demonstrate a conservative approach to debt management and improving financial stability over the years.

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Coverage ratios

The interest coverage ratio for The Cheesecake Factory over the past few years shows a relatively healthy trend. As of January 31, 2023, the interest coverage ratio was 13.77, indicating that the company's operating income was 13.77 times higher than its interest expense for that period. However, the data for December 31, 2023, is unavailable (indicated as "—"), which could potentially signify a lack of reporting for that specific period.

Moving forward, as of January 31, 2024, the interest coverage ratio decreased slightly to 12.84, but still remains at a comfortable level. The next data point available is for January 31, 2025, wherein the interest coverage ratio improved significantly to 17.92, indicating a stronger ability to cover interest expenses with operating income.

Overall, the trend in The Cheesecake Factory's interest coverage ratio suggests that the company has generally been able to comfortably meet its interest obligations over the years, with sufficient operating income to cover interest expenses. However, further analysis would be needed to understand the fluctuations and the potential reasons behind the variations in the ratio over the periods presented in the data.