CVS Health Corp (CVS)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 3.35 | 3.27 | 3.19 | 3.10 | 3.32 |
From the provided data on solvency ratios for CVS Health Corp, we can observe the following key points:
1. Debt-to-assets ratio: The debt-to-assets ratio for CVS Health Corp has consistently remained at 0.00 over the years from 2020 to 2024. This indicates that the company has not used debt to finance its assets during this period, reflecting a strong financial position in terms of asset coverage by equity.
2. Debt-to-capital ratio: Similar to the debt-to-assets ratio, the debt-to-capital ratio also stays constant at 0.00 from 2020 to 2024. This ratio signifies the proportion of capital financed by debt, and CVS Health Corp's consistent 0.00 value implies that the company has not relied on debt for its capital structure during these years.
3. Debt-to-equity ratio: The debt-to-equity ratio for CVS Health Corp is reported at 0.00 for each year from 2020 to 2024. This ratio compares a company's debt to its equity, and the consistent 0.00 value suggests that the company's debt levels are negligible relative to its equity, indicating a low financial risk associated with debt obligations.
4. Financial leverage ratio: The financial leverage ratio, which measures the company's total assets relative to its equity, shows a slight fluctuation over the five-year period. Starting at 3.32 in 2020 and ending at 3.35 in 2024, this ratio indicates that CVS Health Corp has maintained a stable level of financial leverage, with a slight increase over time.
Overall, based on the solvency ratios provided, CVS Health Corp appears to have a strong and stable financial position with minimal debt obligations in relation to its assets, capital, and equity. The consistency of the ratios across the years reflects a prudent financial management approach focused on maintaining a healthy balance between debt and equity financing.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 2.88 | 5.19 | 3.45 | 5.17 | 4.35 |
Interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher ratio indicates a better ability to meet interest obligations.
Analyzing the data provided for CVS Health Corp, we observe the following interest coverage ratios:
- As of December 31, 2020, the interest coverage ratio was 4.35, indicating that the company generated operating income 4.35 times greater than its interest expenses.
- By December 31, 2021, the interest coverage ratio improved to 5.17, suggesting an enhanced ability to meet interest payments.
- However, by December 31, 2022, the interest coverage ratio dropped to 3.45, signaling a decrease in the company's ability to cover interest expenses.
- The ratio rebounded to 5.19 as of December 31, 2023, showing a recovery in the company's ability.
- Finally, as of December 31, 2024, the interest coverage ratio decreased to 2.88, indicating a potential challenge in meeting interest obligations.
Overall, the trend in CVS Health Corp's interest coverage ratio shows fluctuation over the years, with improvements in some years but declines in others. It is essential for the company to closely monitor and manage its interest coverage to ensure it can comfortably meet its interest payments and maintain financial stability.