Federal Signal Corporation (FSS)
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 | 1.49 | 1.62 | 1.77 | 1.74 | 1.72 |
Federal Signal Corporation appears to have a very strong solvency position based on the solvency ratios provided.
1. Debt-to-assets ratio: The company maintains a consistent 0% debt-to-assets ratio for the years 2020 to 2024. This indicates that the company's total debt is extremely low relative to its total assets, suggesting a low level of financial risk and a strong ability to cover its obligations with its asset base.
2. Debt-to-capital ratio: Similar to the debt-to-assets ratio, the company's debt-to-capital ratio remains at 0% across the same period. This implies that the proportion of debt relative to the total capital employed by the company is negligible, signifying a healthy financial structure with less reliance on borrowed funds.
3. Debt-to-equity ratio: The debt-to-equity ratio also stays at 0% from 2020 to 2024. This metric reflects the company's debt level in relation to shareholder equity, and a consistent ratio of 0% indicates that the company is primarily funded by equity, minimizing financial risk associated with debt obligations.
4. Financial leverage ratio: The financial leverage ratio experiences some fluctuations over the years, ranging from 1.49 to 1.77. A decreasing trend observed from 2020 to 2024 implies that the company is effectively reducing its reliance on debt to finance its operations and investments, which can enhance financial stability and flexibility.
Overall, the solvency ratios indicate that Federal Signal Corporation has a solid financial position with very low debt levels compared to its assets, capital, and equity. This suggests a conservative financial strategy and a strong ability to meet financial obligations and capitalize on growth opportunities.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 22.11 | 11.30 | 15.62 | 26.93 | 23.74 |
Federal Signal Corporation's interest coverage has shown a generally strong trend over the period from December 31, 2020, to December 31, 2024. The interest coverage ratio, which measures the company's ability to meet its interest obligations from its operating income, stood at 23.74 in 2020 and improved to 26.93 in 2021, indicating that the company had ample earnings to cover its interest expenses.
However, there was a slight decline in the interest coverage ratio in 2022, dropping to 15.62, and a more significant decrease in 2023 to 11.30. These reductions could suggest a potential strain on the company's ability to meet its interest payments from its operating earnings during these periods.
Nevertheless, Federal Signal Corporation was able to improve its interest coverage ratio in 2024, rising to 22.11. This recovery indicates a strengthening ability to cover interest expenses with operating income, potentially reflecting improved financial performance or effective management of interest costs during that year.
Overall, Federal Signal Corporation's interest coverage ratio has shown some fluctuation but has generally remained at levels that suggest the company has been able to comfortably meet its interest obligations with its operating earnings during the period analyzed.