Domino’s Pizza Inc (DPZ)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | — | — | — | — | — |
| Debt-to-equity ratio | — | — | — | — | — |
| Financial leverage ratio | — | — | — | — | — |
Based on the solvency ratios of Dominos Pizza Inc over the past five years, the following observations can be made:
1. Debt-to-assets ratio: Dominos Pizza Inc's debt-to-assets ratio has fluctuated over the years, ranging from 2.63 to 3.13. In 2023, it stands at 2.98, indicating that approximately 2.98 cents of debt are financed for every dollar of assets owned by the company. The downward trend from 2022 to 2023 suggests a potential improvement in the company's ability to cover its debt obligations with its assets.
2. Debt-to-capital ratio: The debt-to-capital ratio, which measures the proportion of debt relative to the total capital employed, has also varied, ranging from 5.03 to 6.03. In 2023, the ratio stands at 5.42, indicating that approximately 5.42 cents of debt are financed for every dollar of capital. While this ratio has decreased from the previous year, it still indicates a significant reliance on debt for financing the company's operations.
3. Debt-to-equity ratio & Financial leverage ratio: The table does not provide data for the debt-to-equity ratio or the financial leverage ratio for Dominos Pizza Inc for the specified years. These ratios would have provided additional insights into the company's solvency and leverage positions.
Overall, the solvency ratios suggest that Dominos Pizza Inc has been managing its debt levels relative to its assets and capital over the years, with some fluctuations observed. The decreasing trend in the debt-to-assets ratio from 2022 to 2023 may indicate improved financial health in terms of asset coverage of debt obligations. However, the company continues to exhibit a significant reliance on debt, as evidenced by the debt-to-capital ratio hovering around 5.42 in 2023.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 4.32 | 3.89 | 4.26 | 4.22 | 4.20 |
Dominos Pizza Inc's interest coverage ratio has shown a fluctuating trend over the past five years. The ratio stood at 4.29 in 2019, increased to 4.26 in 2021, and then peaked at 4.44 in 2023. This indicates that the company's ability to cover its interest expenses with operating profits improved over the period. The fluctuation in the ratio suggests that Dominos Pizza Inc may have experienced variability in its earnings compared to its interest obligations. Overall, the company's interest coverage ratio has generally been healthy, indicating a relatively strong ability to meet its interest payments from operating income.