CarGurus (CARG)
Solvency ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 1.52 | 1.61 | 1.67 | 1.53 | 1.49 | 1.46 | 1.48 | 1.51 | 1.26 | 1.70 | 2.19 | 2.03 | 1.80 | 1.39 | 1.43 | 1.41 | 1.34 | 1.36 | 1.38 | 1.46 |
CarGurus has consistently maintained a strong solvency position as indicated by its low debt-to-assets, debt-to-capital, and debt-to-equity ratios. These ratios have remained at 0.00 across multiple periods, showing that the company's level of debt is negligible compared to its total assets, capital, and equity.
The financial leverage ratio, which indicates the extent to which a company relies on debt financing, has shown some variability over time. The ratio was relatively stable around 1.4 in 2020 and 2021 but increased significantly to 2.19 in June 2022 before declining to 1.52 by December 2024. This fluctuation suggests that CarGurus may have taken on more debt in the mid-2020s but subsequently managed to reduce its leverage.
Overall, the solvency ratios paint a positive picture of CarGurus' financial health, indicating that the company has a conservative debt structure and has been effectively managing its leverage levels.
Coverage ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | — | 8.04 | 6.37 | 4.16 | 1.21 | 1.15 | 0.54 | 0.49 | 0.58 | 0.98 | 4.27 | 143.56 | 5,357.35 | 5,751.91 | 679.70 | 208.02 | 89.43 | 74.01 | 50.13 | 69.23 |
The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher ratio indicates a better ability to meet interest obligations. For CarGurus, the interest coverage ratio fluctuated significantly over the observed period from March 31, 2020, to December 31, 2024.
From March 2020 to June 2021, CarGurus exhibited a strong interest coverage ratio, with values well above 100, indicating a comfortable ability to cover interest payments. However, there was a substantial decline in the ratio in the following quarters, dropping to extremely low levels by September 2021 and December 2021.
The interest coverage ratio continued to decline sharply in the subsequent quarters, reaching near-zero levels by June 2022, and dropping further to 0.58 by December 2022. This signifies a significant strain on CarGurus' ability to cover its interest expenses with its operating income.
Starting from March 2023, there was a gradual improvement in the interest coverage ratio, reaching 6.37 by June 2024. This improvement suggests that CarGurus' ability to fulfill its interest obligations improved during this period.
Overall, the significant fluctuations in CarGurus' interest coverage ratio indicate varying levels of financial health and sustainability in meeting interest payments over the observed period. It is essential for stakeholders to monitor the trend of this ratio to assess CarGurus' financial stability and ability to manage its debt effectively.