Commercial Metals Company (CMC)
Solvency ratios
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 1.58 | 1.58 | 1.61 | 1.62 | 1.75 | 1.85 | 1.90 | 1.94 | 1.92 | 1.90 | 2.02 | 2.04 | 2.02 | 2.08 | 2.16 | 2.20 | 2.22 | 2.24 | 2.31 | 2.41 |
The solvency ratios of Commercial Metals Company provide insights into the company's ability to meet its long-term financial obligations. The debt-to-assets, debt-to-capital, and debt-to-equity ratios have consistently remained at 0.00, indicating that the company has not relied heavily on debt to finance its operations relative to its assets, capital, or shareholder equity.
However, the financial leverage ratio has exhibited fluctuations over the periods analyzed, ranging from 1.58 to 2.41. A higher financial leverage ratio suggests that the company is utilizing more debt to finance its operations, which can increase financial risk and interest expenses. The increasing trend in the financial leverage ratio over the periods may indicate a growing reliance on debt financing, which could potentially impact the company's financial stability and ability to sustain its debt levels in the long term.
Overall, while the debt-related ratios show minimal debt usage, the increasing financial leverage ratio highlights a need for monitoring the company's debt management and capital structure to ensure sustainable financial health and solvency.
Coverage ratios
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 22.82 | 26.96 | 28.96 | 27.52 | 27.01 | 31.20 | 30.88 | 29.44 | 25.27 | 15.59 | 11.29 | 8.89 | 7.03 | 6.83 | 7.02 | 6.93 | 6.94 | 5.95 | 4.75 | 4.22 |
The interest coverage ratio for Commercial Metals Company has exhibited a generally increasing trend over the past few quarters, indicating the company's ability to comfortably meet its interest payment obligations from its earnings. The ratio stood at 22.82 as of February 29, 2024, reflecting a strong coverage of 22.82 times. This suggests that the company's earnings before interest and taxes (EBIT) were 22.82 times its interest expenses for that period.
The company's interest coverage has shown significant improvement compared to the earlier quarters, with ratios above 20, indicating a robust ability to service its debt. This trend signifies better financial health and reduced financial risk for the company. The highest interest coverage ratio of 31.20 was recorded on November 30, 2022, indicating the strongest ability to cover interest expenses during that period.
Overall, the consistently high interest coverage ratios of Commercial Metals Company suggest a strong financial position and ability to handle debt obligations comfortably. Investors and creditors may view this positively as it indicates a lower risk of default on interest payments.