The Cooper Companies Inc. (COO)
Solvency ratios
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.23 | 0.22 | 0.21 | 0.22 | 0.23 | 0.20 | 0.20 | 0.20 | 0.20 | 0.15 | 0.12 | 0.15 | 0.16 | 0.21 | 0.20 | 0.21 | 0.19 | 0.20 | 0.23 | 0.24 |
| Debt-to-capital ratio | 0.26 | 0.25 | 0.25 | 0.26 | 0.26 | 0.25 | 0.25 | 0.25 | 0.25 | 0.17 | 0.15 | 0.18 | 0.19 | 0.27 | 0.26 | 0.27 | 0.25 | 0.26 | 0.28 | 0.29 |
| Debt-to-equity ratio | 0.35 | 0.33 | 0.33 | 0.35 | 0.36 | 0.33 | 0.33 | 0.33 | 0.34 | 0.20 | 0.17 | 0.21 | 0.24 | 0.36 | 0.35 | 0.37 | 0.33 | 0.35 | 0.39 | 0.42 |
| Financial leverage ratio | 1.56 | 1.54 | 1.55 | 1.56 | 1.58 | 1.60 | 1.63 | 1.68 | 1.68 | 1.38 | 1.42 | 1.46 | 1.49 | 1.76 | 1.79 | 1.79 | 1.76 | 1.73 | 1.71 | 1.75 |
Based on the solvency ratios of Cooper Companies, Inc. from Q1 2024 to Q2 2022, we can observe the following trends:
1. Debt-to-assets ratio: This ratio measures the proportion of the company's assets financed by debt. Over the periods analyzed, the debt-to-assets ratio has remained relatively stable, fluctuating between 0.22 and 0.25, indicating that around 22% to 25% of the company's assets are financed by debt.
2. Debt-to-capital ratio: The debt-to-capital ratio signifies the proportion of the company's capital structure that is in the form of debt. It also demonstrates a stable trend, varying from 0.25 to 0.32, illustrating that debt comprises approximately 25% to 32% of Cooper Companies' capital structure.
3. Debt-to-equity ratio: This ratio reveals the extent to which the company's operations are funded by debt relative to shareholders' equity. The debt-to-equity ratio has shown a somewhat increasing trend, climbing from 0.34 to 0.46, implying that the company is relying more on debt financing compared to equity financing.
4. Financial leverage ratio: The financial leverage ratio provides insight into the company's level of financial risk by showing how much of its assets are funded by debt. This ratio has been escalating from 1.54 to 1.68, suggesting that the company's reliance on debt to finance its assets has been gradually increasing.
Overall, the solvency ratios of Cooper Companies, Inc. over the analyzed periods reflect a stable debt structure in terms of assets and capital, while indicating a shift towards higher reliance on debt relative to equity. The increasing financial leverage ratio implies a rising financial risk associated with the company's capital structure. It is essential for stakeholders to monitor these trends carefully to assess the company's solvency and financial stability.
Coverage ratios
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 4.77 | 4.92 | 4.72 | 5.10 | 7.19 | 9.29 | 14.28 | 18.90 | 21.34 | 22.28 | 19.69 | 18.51 | 10.77 | 8.24 | 7.73 | 7.49 | 8.82 | 8.01 | 7.06 | 6.16 |
The interest coverage ratio reflects Cooper Companies, Inc.'s ability to meet its interest obligations with its operating income. A higher interest coverage ratio indicates a stronger ability to cover interest expenses.
In the given data, the interest coverage ratio has been fluctuating over the past quarters. In Q1 2024, the ratio was 4.92, which improved compared to the previous quarter but remained lower than the levels seen in earlier periods. This suggests that the company's ability to cover interest expenses with its operating income has decreased slightly.
Looking back at the trend over the past year, the interest coverage ratio has been on a declining trend from Q2 2022 to Q1 2024. While the ratio was very healthy in Q2 2022 and Q3 2022 at 13.49 and 17.60 respectively, it has since decreased significantly, indicating a potential decrease in the company's ability to cover interest expenses over time.
Overall, the downward trend in the interest coverage ratio raises a concern about Cooper Companies, Inc.'s ability to comfortably meet its interest obligations in the future, highlighting a potential strain on the company's financial health. Further analysis of the company's operating income and interest expenses is recommended to better understand the reasons behind this trend.