Eagle Materials Inc (EXP)

Eagle Materials Inc's solvency ratios indicate the company's ability to meet its long-term financial obligations. Looking at the debt-to-assets ratio, we see a decreasing trend over the past five years, going from 0.53 in 2020 to 0.37 in 2024. This suggests a more conservative approach to financing with a lower dependence on debt to fund its assets.

Similarly, the debt-to-capital and debt-to-equity ratios also show a declining trend, indicating a reduced reliance on debt relative to equity and capital over the years. The debt-to-capital ratio decreased from 0.62 in 2020 to 0.45 in 2024, while the debt-to-equity ratio declined from 1.62 in 2020 to 0.83 in 2024. These improvements reflect a strengthening financial position and lower risk exposure from debt financing.

The financial leverage ratio, which indicates the proportion of assets financed by debt, also shows a decreasing trend from 3.06 in 2020 to 2.25 in 2024. This suggests that Eagle Materials Inc has been reducing its financial leverage and potentially improving its financial stability and flexibility over the years.

Overall, based on the solvency ratios, Eagle Materials Inc appears to have made significant progress in managing its debt levels and enhancing its financial health, which may lead to improved long-term sustainability and risk management.

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Coverage ratios

The interest coverage ratio for Eagle Materials Inc has shown a generally positive trend over the past five years, indicating the company's ability to meet its interest obligations from its operating income. The ratio has consistently improved from 3.48 in 2020 to 15.62 in 2024, with variations in between.

The company's interest coverage was at a strong level in 2023 and 2022, with ratios of 17.74 and 16.39 respectively, suggesting a comfortable cushion between its earnings and interest expenses. In 2021, there was a slight decrease in the ratio to 10.67, which could indicate a temporary strain on the company's ability to cover its interest payments.

The significant improvement in the interest coverage ratio in 2024 to 15.62 reflects positively on the company's financial health and ability to service its debt obligations. Overall, Eagle Materials Inc appears to have a solid capacity to cover its interest expenses and is demonstrating a positive trend in managing its financial obligations.