FedEx Corporation (FDX)
Solvency ratios
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 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 | 3.15 | 3.34 | 3.45 | 3.43 | 4.02 |
FedEx Corporation has consistently maintained a debt-to-assets ratio of 0.00 over the past five years, indicating that the company has not used debt to finance its assets during this period. Similarly, the debt-to-capital and debt-to-equity ratios have also remained at 0.00, suggesting a lack of financial leverage through debt obligations.
However, the financial leverage ratio for FedEx has fluctuated over the years, decreasing from 4.02 in 2020 to 3.15 in 2024. This indicates that the company has reduced its reliance on debt to fund its operations and investments, resulting in a more favorable financial leverage position in the most recent year.
Overall, based on the solvency ratios provided, FedEx Corporation appears to have a strong financial position with minimal debt obligations relative to its assets, capital, and equity. The decreasing trend in the financial leverage ratio reflects a prudent approach to managing leverage and indicates improved financial stability.
Coverage ratios
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 8.83 | 8.73 | 8.11 | 9.42 | 3.48 |
The interest coverage ratio for FedEx Corporation has shown a generally positive trend over the past five years. The ratio has consistently been above 1, indicating that the company's earnings before interest and taxes (EBIT) have been sufficient to cover its interest expenses.
In particular, for the most recent fiscal year ending May 31, 2024, the interest coverage ratio stood at 8.83. This suggests that FedEx's EBIT was 8.83 times greater than its interest expenses for that period.
The gradual increase in the interest coverage ratio from 2020 to 2022 showcases an improvement in FedEx's ability to meet its interest obligations with its operating income. The ratio peaked in 2021 at 9.42 before slightly decreasing in 2023 and 2024, indicating a slightly reduced buffer for covering interest expenses in those years.
Overall, the consistent and generally strong interest coverage ratios demonstrate FedEx Corporation's ability to comfortably meet its interest payments, which is a positive indicator of the company's financial health and stability.