Fulgent Genetics Inc (FLGT)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 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 | 1.08 | 1.09 | 1.09 | 1.10 | 1.23 |
Fulgent Genetics Inc has consistently maintained a strong solvency position as indicated by its debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio all being at 0.00 for the years 2020 through 2024. This implies that the company has not taken on any long-term debt relative to its total assets, capital, or equity during this period.
Furthermore, the financial leverage ratio has been decreasing over the years, indicating a reduction in the company's reliance on debt financing. The trend from a ratio of 1.23 in 2020 to 1.08 in 2024 suggests that Fulgent Genetics has been gradually optimizing its capital structure to rely more on equity than debt to fund its operations. This decreasing trend in financial leverage ratio reflects a positive sign of financial stability and decreased risk of default.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 0.00 | -1.96 | 33.59 | 16.81 | 819.66 |
Interest coverage, a financial ratio that measures a company's ability to meet its interest payments on debt, is a key indicator of financial health. In the case of Fulgent Genetics Inc, the interest coverage ratio has fluctuated over the years:
- As of December 31, 2020, the interest coverage ratio was exceptionally high at 819.66, indicating that the company's operating income was significantly higher than its interest expense, reflecting strong financial stability.
- By December 31, 2021, the interest coverage ratio decreased to 16.81, suggesting a decline in the company's ability to cover its interest payments. This significant drop in the ratio could raise concerns about the company's financial sustainability.
- However, the ratio improved to 33.59 by December 31, 2022, indicating a better ability to cover interest expenses compared to the previous year. This positive trend could signal a recovery in the company's financial position.
- The interest coverage ratio turned negative at -1.96 on December 31, 2023, indicating that the company's operating income was insufficient to cover its interest obligations. This is a red flag as it may indicate financial distress or inadequate cash flow.
- The ratio dropped to 0.00 as of December 31, 2024, further highlighting the company's inability to meet its interest payments. This could potentially signal a serious financial challenge and the need for immediate attention to address the situation.
In conclusion, the fluctuating interest coverage ratios of Fulgent Genetics Inc over the years suggest varying levels of financial health and operational efficiency. It is essential for stakeholders to monitor these ratios closely to assess the company's ability to manage its debt obligations and maintain financial stability.