Fortune Brands Innovations Inc. (FBIN)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.33 | 0.41 | 0.34 | 0.29 | 0.35 |
| Debt-to-capital ratio | 0.47 | 0.54 | 0.50 | 0.43 | 0.48 |
| Debt-to-equity ratio | 0.90 | 1.16 | 0.99 | 0.75 | 0.93 |
| Financial leverage ratio | 2.71 | 2.86 | 2.93 | 2.59 | 2.65 |
Fortune Brands Innovations Inc. has shown a fluctuating trend in its solvency ratios over the five-year period from 2020 to 2024. The Debt-to-assets ratio, which measures the proportion of the company's assets financed by debt, decreased from 0.35 in 2020 to 0.29 in 2021, before increasing to 0.41 in 2023, and then declining to 0.33 in 2024.
The Debt-to-capital ratio, indicating the percentage of the company's capital that is funded by debt, followed a similar pattern. It declined from 0.48 in 2020 to 0.43 in 2021, then increased to 0.54 in 2023, and decreased to 0.47 in 2024.
In terms of the Debt-to-equity ratio, which reflects the proportion of the company's financing that comes from equity compared to debt, there was a notable decrease from 0.93 in 2020 to 0.75 in 2021, followed by an increase to 1.16 in 2023, and then a decrease to 0.90 in 2024.
Lastly, the Financial leverage ratio, which indicates the extent to which the company relies on debt to finance its operations, showed a less erratic trend with values ranging from 2.59 to 2.93 over the period, with a slight decrease to 2.71 in 2024.
Overall, the solvency ratios of Fortune Brands Innovations Inc. suggest fluctuations in the company's debt levels and capital structure, indicating the evolving financial leverage and risk profile of the organization during the period under review.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 6.12 | 5.28 | 7.83 | 12.14 | 8.92 |
Fortune Brands Innovations Inc.'s interest coverage ratio has shown some fluctuations over the past five years. In 2020, the interest coverage ratio was 8.92, indicating that the company's operating income was nearly 9 times its interest expense for that year. The ratio improved in 2021 to 12.14, suggesting a stronger ability to cover interest payments.
However, there was a decline in the interest coverage ratio in 2022 to 7.83, which may indicate a potential strain on the company's ability to cover its interest expenses. This trend continued in 2023, with a further decrease in the interest coverage ratio to 5.28, raising concerns about the company's ability to meet its interest obligations comfortably.
In 2024, the interest coverage ratio improved slightly to 6.12 but remained below the levels seen in 2020 and 2021. Overall, Fortune Brands Innovations Inc. should closely monitor its interest coverage ratio as a lower ratio could indicate financial instability and potential difficulties in meeting debt obligations.