DexCom Inc (DXCM)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.39 | 0.22 | 0.35 | 0.39 | 0.44 |
| Debt-to-capital ratio | 0.54 | 0.36 | 0.45 | 0.52 | 0.55 |
| Debt-to-equity ratio | 1.18 | 0.56 | 0.83 | 1.07 | 1.20 |
| Financial leverage ratio | 3.03 | 2.53 | 2.42 | 2.76 | 2.71 |
Dexcom Inc's solvency ratios reflect the company's ability to meet its long-term financial obligations. The trends in the ratios over the past five years provide valuable insights into the company's financial health.
The debt-to-assets ratio has shown a slight increase from 0.36 in 2021 to 0.40 in 2023, indicating that Dexcom's debt level in relation to its total assets has inched up. This suggests that a larger proportion of the company's assets are financed by debt.
The debt-to-capital ratio has also been on an upward trend, rising from 0.44 in 2021 to 0.55 in 2023. This indicates that Dexcom's reliance on debt for its capital structure has been increasing over the years.
The debt-to-equity ratio has fluctuated over the five-year period, reaching a peak of 1.22 in 2019 and dropping to 0.78 in 2021 before climbing back up to 1.21 in 2023. These numbers signify that the company's debt level relative to its equity has varied, with periods of higher and lower leverage.
The financial leverage ratio, which measures the extent to which the company is using debt to finance its assets, has shown a general increasing trend, rising from 2.16 in 2021 to 3.03 in 2023. This signifies that Dexcom's financial leverage has been on the rise, indicating a higher level of risk associated with its capital structure.
In conclusion, Dexcom Inc's solvency ratios suggest that the company has been increasing its reliance on debt to finance its operations, which could potentially increase its financial risk in the long run. It is important for stakeholders to closely monitor these ratios to assess the company's ability to meet its debt obligations and maintain a healthy financial position.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 36.00 | 22.01 | 14.66 | 17.83 | 2.73 |
Interest coverage is a financial ratio that measures a company's ability to meet its interest expenses from its operating income. A higher interest coverage ratio indicates that the company is more capable of covering its interest obligations.
Looking at the trend of Dexcom Inc's interest coverage ratio from 2019 to 2023, we observe a significant improvement over the years. In 2019 and 2020, the company had relatively low interest coverage ratios of 2.29 and 3.54, respectively. However, there was a notable increase in the interest coverage ratio in 2021 to 2.77, suggesting an improvement in the company's ability to cover its interest expenses. This positive trend continued with a substantial jump in 2022 to 21.04, indicating a significant increase in the company's capacity to meet its interest obligations.
The most recent data for 2023 shows a further enhancement in Dexcom Inc's interest coverage ratio to 29.54, reflecting a strong ability to cover its interest costs. This steady improvement in interest coverage ratios over the years is a positive sign for the company, indicating improved financial health and lower risk of default on its debt obligations.