Calavo Growers Inc (CVGW)
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 | 0.11 | 0.02 | 0.10 | 0.00 | 0.00 | 0.02 | 0.00 | 0.00 | 0.00 | 0.02 | 0.00 | 0.00 | 0.00 | 0.02 | 0.00 | 0.00 | 0.00 | 0.02 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.18 | 0.03 | 0.15 | 0.00 | 0.00 | 0.03 | 0.00 | 0.00 | 0.00 | 0.03 | 0.00 | 0.00 | 0.00 | 0.03 | 0.00 | 0.00 | 0.00 | 0.02 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.22 | 0.03 | 0.18 | 0.00 | 0.00 | 0.03 | 0.00 | 0.00 | 0.00 | 0.03 | 0.00 | 0.00 | 0.00 | 0.03 | 0.00 | 0.00 | 0.00 | 0.02 | 0.00 | 0.00 |
| Financial leverage ratio | 1.96 | 1.85 | 1.91 | 1.92 | 1.84 | 1.73 | 1.92 | 2.10 | 2.11 | 1.98 | 1.78 | 1.75 | 1.72 | 1.69 | 1.63 | 1.68 | 1.65 | 1.37 | 1.39 | 1.43 |
Calavo Growers Inc's solvency ratios, including the debt-to-assets ratio, debt-to-capital ratio, debt-to-equity ratio, and financial leverage ratio, provide valuable insights into the company's financial health and risk levels.
The debt-to-assets ratio measures the proportion of the company's assets financed through debt. Calavo Growers Inc has maintained low levels of debt relative to its assets over the analyzed periods, with the ratio fluctuating between 0.00 and 0.11. This indicates the company has a lower reliance on debt to fund its operations and suggests a relatively strong financial position.
The debt-to-capital ratio, which indicates the extent of debt in the company's capital structure, also remains low for Calavo Growers Inc, ranging from 0.00 to 0.18. This implies that the company has a higher proportion of equity in its capital structure compared to debt, reducing the financial risk associated with high debt levels.
Similarly, the debt-to-equity ratio, reflecting the relationship between debt and shareholders' equity, shows consistent low values between 0.00 and 0.22 for Calavo Growers Inc. This indicates that the company relies more on equity financing than debt, which can enhance financial stability and insulate the business from potential financial distress.
The financial leverage ratio, measuring the company's overall debt levels in relation to its equity, has varied across the analyzed periods for Calavo Growers Inc, ranging from 1.37 to 2.11. While the ratios indicate that the company has used debt as a source of financing, the values suggest a moderate level of leverage that is manageable and not overly risky.
Overall, based on the solvency ratios analyzed, Calavo Growers Inc appears to maintain a prudent and balanced capital structure with a conservative approach to debt management, which may contribute to its overall financial stability and resilience.
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 | -0.36 | 0.04 | 0.96 | -2.25 | -0.10 | -0.78 | -14.08 | -19.89 | -13.19 | -0.34 | 38.17 | 10.80 | -9.54 | -19.43 | 4.35 | 35.65 | 64.71 | 68.24 | 33.69 | 46.77 |
Calavo Growers Inc's interest coverage ratio fluctuated significantly over the past several quarters. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt with its operating income. A ratio below 1 indicates that the company is not generating enough operating income to cover its interest expenses.
From January 2020 to April 2020, the interest coverage ratio improved, suggesting that the company was better able to meet its interest obligations. However, in the subsequent quarters, the ratio deteriorated notably, falling below 1 in several periods, indicating potential financial distress.
The sharp decline in the interest coverage ratio in the middle of 2022 and throughout 2023 raises concerns about the company's ability to service its debt obligations using its operating income. The ratios of -14.08 and -19.89 in July 2022 and April 2022, respectively, reflect particularly challenging periods for the company in terms of covering interest expenses.
The sudden improvement in the interest coverage ratio in the later quarters of 2023 and early 2024 may signal a positive turn in the company's ability to meet its interest payments. However, the consistently volatile nature of the ratio over the analyzed periods suggests that Calavo Growers Inc may face ongoing challenges in maintaining a stable financial position with respect to its debt obligations.