Estee Lauder Companies Inc (EL)
Solvency ratios
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 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 | 4.08 | 4.19 | 3.74 | 3.63 | 4.52 |
Estee Lauder Companies Inc has consistently maintained a debt-free capital structure over the past five years, as indicated by a debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio of 0.00 for each year. This reflects the company's ability to operate without relying on external debt to finance its operations and investments.
However, the financial leverage ratio has fluctuated over the years, with a high of 4.52 in 2020 and a low of 3.63 in 2021. The financial leverage ratio measures the extent to which a company relies on debt financing to support its assets, with higher ratios indicating higher financial risk. Although the ratio has shown variability, it is generally within a manageable range for the company.
Overall, Estee Lauder Companies Inc's solvency ratios suggest a strong financial position with minimal leverage and a healthy capital structure, which may indicate a lower risk of financial distress and greater financial stability.
Coverage ratios
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 2.57 | 5.92 | 18.98 | 15.13 | 7.42 |
Estee Lauder Companies Inc's interest coverage ratio has shown fluctuations over the past five years. In particular, the ratio has decreased significantly from 18.98 in June 2022 to 2.57 in June 2024. This downward trend indicates that the company's ability to cover its interest expenses with its operating income has weakened in recent years. A lower interest coverage ratio may suggest a higher risk of financial distress if the company is unable to generate sufficient earnings to meet its interest obligations. It is essential for Estee Lauder Companies Inc to closely monitor and manage its interest coverage ratio to ensure it remains at a healthy level and does not pose a threat to the company's financial stability.