Cisco Systems Inc (CSCO)
Solvency ratios
| Jul 27, 2024 | Jul 29, 2023 | Jul 30, 2022 | Jul 31, 2021 | Jul 25, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.16 | 0.07 | 0.09 | 0.09 | 0.12 |
| Debt-to-capital ratio | 0.30 | 0.13 | 0.17 | 0.18 | 0.23 |
| Debt-to-equity ratio | 0.43 | 0.15 | 0.21 | 0.22 | 0.31 |
| Financial leverage ratio | 2.74 | 2.30 | 2.36 | 2.36 | 2.50 |
Cisco Systems Inc's solvency ratios depict a consistent trend of strong financial health over the past five years. The debt-to-assets ratio has remained relatively stable, ranging from 0.07 to 0.16, indicating that the company relies modestly on debt to finance its assets. This suggests a prudent management of assets and liabilities.
Similarly, the debt-to-capital and debt-to-equity ratios reflect a relatively low level of debt compared to the company's total capital and equity, with values consistently below 0.5. This signifies that Cisco has a strong capital structure with a lower reliance on debt financing, which may reduce financial risk and enhance investor confidence.
Furthermore, the financial leverage ratio, which measures the proportion of debt in the company's capital structure, has also shown a consistent improvement over the years, decreasing from 2.50 in 2020 to 2.74 in 2024. A lower financial leverage ratio indicates a lower proportion of debt to equity, implying that Cisco has maintained a conservative approach to financing its operations.
Overall, based on these solvency ratios, Cisco Systems Inc appears to have a solid financial position with prudent debt management practices, which bodes well for its long-term stability and ability to meet its financial obligations.
Coverage ratios
| Jul 27, 2024 | Jul 29, 2023 | Jul 30, 2022 | Jul 31, 2021 | Jul 25, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 12.11 | 36.87 | 41.21 | 31.56 | 24.88 |
Cisco Systems Inc's interest coverage ratio has been consistently strong over the past five years, indicating the company's ability to comfortably meet its interest obligations. The interest coverage ratio was at its highest in July 2022 at 41.21, showing that Cisco generated over 41 times the amount needed to cover its interest expenses. While there was a slight decrease in the ratio in the following years, it remained comfortably above 20, with the latest ratio of 12.11 in July 2024 still reflecting a healthy ability to cover interest expenses. This consistent performance suggests that Cisco has a solid financial position and is managing its debt obligations effectively.