GATX Corporation (GATX)
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 | 5.04 | 4.98 | 4.96 | 4.73 | 4.57 |
GATX Corporation's solvency ratios indicate a strong financial position with consistently low debt levels relative to its assets, capital, and equity over the past five years. The Debt-to-assets ratio, Debt-to-capital ratio, and Debt-to-equity ratio have all remained at 0.00, reflecting the company's ability to operate with minimal reliance on external debt to fund its operations and investments.
Additionally, the Financial leverage ratio has shown a slight increasing trend from 4.57 in 2020 to 5.04 in 2024. This ratio signifies the extent to which the company utilizes debt financing in its capital structure. Despite the gradual increase, the financial leverage ratio remains at a moderate level, suggesting that GATX Corporation has maintained a healthy balance between debt and equity to support its growth and profitability.
Overall, these solvency ratios depict GATX Corporation as a financially stable company with a prudent approach to managing its debt obligations and financial risk, positioning it well to withstand economic downturns and capitalize on future opportunities.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 2.01 | 2.21 | 1.98 | 1.96 | 1.99 |
Interest coverage is a financial metric that indicates a company's ability to pay its interest expenses on outstanding debt. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expenses. A higher interest coverage ratio indicates that the company has more earnings to cover its interest payments.
Analysis of GATX Corporation's interest coverage based on the provided data shows fluctuations over the years:
- As of December 31, 2020, the interest coverage ratio was 1.99, indicating that the company's earnings were just enough to cover its interest expenses.
- By December 31, 2021, the interest coverage ratio decreased to 1.96, suggesting a slight decline in the ability to cover interest payments.
- The ratio improved slightly to 1.98 by December 31, 2022, but it remained relatively close to the previous year's level.
- A significant improvement was seen by December 31, 2023, with the interest coverage ratio increasing to 2.21, indicating a stronger ability to cover interest expenses.
- However, by December 31, 2024, the interest coverage ratio dropped to 2.01, although it still remained above the levels reported in earlier years.
Overall, fluctuations in GATX Corporation's interest coverage ratio suggest variability in its ability to cover interest payments over the years. It will be important for the company to closely monitor and manage its interest expenses relative to its earnings to ensure financial stability and sustainability.