The Cheesecake Factory (CAKE)
Solvency ratios
| Jan 31, 2025 | Dec 31, 2024 | Oct 31, 2024 | Sep 30, 2024 | Jul 31, 2024 | Jun 30, 2024 | Apr 30, 2024 | Mar 31, 2024 | Jan 31, 2024 | Dec 31, 2023 | Oct 31, 2023 | Sep 30, 2023 | Jul 31, 2023 | Jun 30, 2023 | Apr 30, 2023 | Mar 31, 2023 | Jan 31, 2023 | Dec 31, 2022 | Oct 31, 2022 | Sep 30, 2022 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.15 | 0.00 | 0.16 | 0.00 | 0.16 | 0.00 | 0.17 | 0.00 | 0.17 | 0.00 | 0.17 | 0.00 | 0.17 | 0.00 | 0.17 | 0.00 | 0.17 | 0.00 | 0.17 |
| Debt-to-capital ratio | 0.00 | 0.50 | 0.00 | 0.54 | 0.00 | 0.56 | 0.00 | 0.59 | 0.00 | 0.60 | 0.00 | 0.59 | 0.00 | 0.59 | 0.00 | 0.61 | 0.00 | 0.62 | 0.00 | 0.59 |
| Debt-to-equity ratio | 0.00 | 1.02 | 0.00 | 1.19 | 0.00 | 1.26 | 0.00 | 1.42 | 0.00 | 1.48 | 0.00 | 1.46 | 0.00 | 1.44 | 0.00 | 1.56 | 0.00 | 1.60 | 0.00 | 1.45 |
| Financial leverage ratio | 6.86 | 6.86 | 7.41 | 7.41 | 7.70 | 7.70 | 8.54 | 8.54 | 8.93 | 8.93 | 8.61 | 8.63 | 8.50 | 8.50 | 9.15 | 9.15 | 9.50 | 9.50 | 8.45 | 8.45 |
The solvency ratios of The Cheesecake Factory, which include the debt-to-assets ratio, debt-to-capital ratio, debt-to-equity ratio, and financial leverage ratio, provide insights into the company's ability to meet its financial obligations and utilize debt responsibly.
The debt-to-assets ratio measures the proportion of the company's assets financed by debt. The ratio fluctuated between 0.00 to 0.17 over the past few quarters, indicating that the company's debt levels relative to its total assets have been relatively low and stable.
The debt-to-capital ratio reflects the extent to which debt contributes to the company's capital structure. The ratio ranged from 0.00 to 0.62 during the period under review, showing variability in how much of the company's capital is derived from debt financing.
The debt-to-equity ratio assesses the relationship between debt and shareholders' equity in the company. The ratio varied from 0.00 to 1.60 across the quarters, illustrating the mix of debt and equity in the company's funding structure.
The financial leverage ratio measures the company's debt relative to its equity or capital. The ratio decreased from 8.45 to 6.86 during the observation period, suggesting a trend towards lower financial risk and reliance on debt.
Overall, The Cheesecake Factory's solvency ratios indicate a generally moderate level of debt utilization and financial leverage, with a trend towards more conservative leverage levels in recent quarters. Monitoring these ratios can help stakeholders assess the company's financial risk and sustainability over time.
Coverage ratios
| Jan 31, 2025 | Dec 31, 2024 | Oct 31, 2024 | Sep 30, 2024 | Jul 31, 2024 | Jun 30, 2024 | Apr 30, 2024 | Mar 31, 2024 | Jan 31, 2024 | Dec 31, 2023 | Oct 31, 2023 | Sep 30, 2023 | Jul 31, 2023 | Jun 30, 2023 | Apr 30, 2023 | Mar 31, 2023 | Jan 31, 2023 | Dec 31, 2022 | Oct 31, 2022 | Sep 30, 2022 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 27.26 | 42.88 | 45.74 | 50.47 | 51.83 | 47.06 | 35.14 | 26.89 | 22.40 | 22.86 | 32.25 | 37.60 | 41.28 | 25.80 | 10.22 | 0.43 | -10.04 | 5.08 | 22.69 | 33.62 |
The interest coverage ratio for The Cheesecake Factory demonstrates the company's ability to cover its interest expenses with its operating income. Looking at the data provided, there is a fluctuation in the interest coverage ratio over the period from September 2022 to January 2025.
The trend indicates that The Cheesecake Factory had a strong interest coverage ratio in the earlier periods, with values above 20 indicating a comfortable level of coverage. However, there was a sharp decline in the ratio in January 2023, where it turned negative, suggesting that the company was not generating sufficient operating income to cover its interest expenses during that period.
Subsequently, the interest coverage ratio started to improve, gradually increasing from the negative territory to positive values. This improvement continued through the following periods, reaching higher levels by July 2024. The interest coverage ratio consistently stayed above 25 from June 2023 onwards, indicating a healthy ability to cover interest expenses comfortably.
Overall, the improving trend in the interest coverage ratio for The Cheesecake Factory from the challenging period in early 2023 to the strong performance in late 2024 suggests that the company has been able to enhance its operational profitability and financial stability.