Godaddy Inc (GDDY)
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 | — |
| Debt-to-equity ratio | 0.00 | 0.00 | — | 0.00 | — |
| Financial leverage ratio | 11.90 | 121.62 | — | 90.78 | — |
The solvency ratios for Godaddy Inc indicate a strong financial position in terms of debt management. The Debt-to-assets ratio remained consistently at 0.00 over the five-year period, suggesting that the company's total debt is well-covered by its assets.
The Debt-to-capital ratio also demonstrated a healthy trend, with values at 0.00 for the majority of the years, indicating that the company's debt is well-managed in relation to its total capital structure.
Similarly, the Debt-to-equity ratio remained stable at 0.00 for the years reported, implying that the company's debt level is negligible compared to its equity, reflecting a low financial risk.
The Financial leverage ratio showed fluctuations, with a significant increase in 2023 but a steep decline in 2024 to 11.90. This ratio measures the extent to which the company relies on debt to fund its operations, and the decreasing trend in recent years indicates a more conservative approach to leverage.
Overall, the solvency ratios paint a favorable picture of Godaddy Inc's financial health, showcasing effective debt management and a strong capital structure.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 5.89 | 3.63 | 3.76 | 3.65 | -4.39 |
Interest coverage is a key financial ratio that provides insight into a company's ability to meet its interest obligations through its operating income. The interest coverage ratio is calculated by dividing the earnings before interest and taxes (EBIT) by the interest expense. A ratio below 1 indicates that the company is not generating enough operating income to cover its interest expenses, which may signal financial distress.
For Godaddy Inc, the interest coverage ratio has shown a mixed trend over the years based on the provided data:
- In December 31, 2020, the interest coverage ratio was -4.39, indicating that the company's operating income was insufficient to cover its interest expenses, raising concerns about its ability to meet financial obligations.
- The ratio improved significantly in the following years, reaching 3.65 in December 31, 2021, and continued to rise to 3.76 in December 31, 2022, and 3.63 in December 31, 2023. These improvements suggest that Godaddy Inc's operating income has become more effective in covering its interest payments.
- By December 31, 2024, the interest coverage ratio further increased to 5.89, indicating a stronger ability to meet interest obligations using operating income.
Overall, the positive trend in Godaddy Inc's interest coverage ratio from negative to positive values reflects an improvement in the company's financial health and its ability to cover interest expenses with its operating income. However, continuous monitoring of this ratio is recommended to ensure the company's ongoing financial stability.