GMS Inc (GMS)
Solvency ratios
| Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 2.70 | 2.72 | 2.74 | 2.65 | 2.57 | 2.31 | 2.41 | 2.44 | 2.56 | 2.63 | 2.74 | 2.82 | 2.92 | 3.08 | 2.97 | 3.04 | 3.02 | 2.96 | 3.08 | 3.26 |
The analysis of GMS Inc.’s solvency ratios indicates a consistent pattern of conservative leverage and negligible debt levels over the evaluated period. Notably, the Debt-to-Assets Ratio, Debt-to-Capital Ratio, and Debt-to-Equity Ratio remain at zero across all reported dates, implying that the company did not possess any measurable debt relative to its assets, capital, or equity during this timeframe. This suggests an extremely conservative or debt-free capital structure, which enhances the firm’s ability to meet obligations and withstand financial distress without relying on external debt sources.
While the debt ratios are zero, the Financial Leverage Ratio fluctuates within a relatively narrow range, decreasing from approximately 3.26 in July 2020 to a low of around 2.31 in January 2024, before marginally rising again to approximately 2.70 by April 2025. The decline in leverage indicates a reduction in the proportion of assets financed through debt, further emphasizing a strategic focus on maintaining low indebtedness.
This pattern of negligible or zero debt ratios, combined with stable financial leverage, suggests that GMS Inc. maintains a highly conservative capital structure. The company appears to rely primarily on equity or internally generated funds rather than external borrowing. The low or absent debt levels reduce financial risk, improve resilience during economic downturns, and lessen interest payment obligations. Overall, the data reflect a strong solvency position characterized by minimal leverage and a sustainable capital structure, enhancing the firm’s ability to meet long-term obligations without significant reliance on debt financing.
Coverage ratios
| Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 2.27 | 3.41 | 4.51 | 5.17 | 5.82 | 6.13 | 6.59 | 7.26 | 7.78 | 8.28 | 8.41 | 7.91 | 7.36 | 6.52 | 5.54 | 4.47 | 3.59 | 2.01 | 1.85 | 1.80 |
The interest coverage ratio of GMS Inc. demonstrates a pattern of initial improvement followed by gradual decline over the analyzed period. Starting from a low of 1.80 on July 31, 2020, the ratio increased steadily, reaching a peak of 8.41 on October 31, 2022. This indicates a robust capacity to meet interest obligations during this period, implying a strong financial position and efficient management of debt service.
However, after this peak, the ratio exhibits a consistent downward trend, diminishing to 6.13 as of January 31, 2024, and continuing to decline further to 2.27 by April 30, 2025. This decline suggests a decreasing ability to cover interest expenses with earnings before interest and taxes (EBIT), reflecting potential increases in debt levels, reductions in operating income, or both.
Throughout the period, the initial ratios below 2.0, such as 1.80 in mid-2020, indicate periods where interest obligations may have been challenging to cover comfortably, warranting attention to financial leverage and risk. The subsequent increase to above 8.0 indicates a phase of improved financial health and reduced risk associated with interest payments.
The ongoing decline, particularly moving toward a ratio near 2.0, signals a deterioration in interest coverage capacity, which could become a concern for financial stability if the trend persists. The overall trajectory underscores the importance of monitoring operational profitability and debt management strategies to sustain healthy coverage levels.