Group 1 Automotive Inc (GPI)
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 | 3.30 | 2.91 | 3.00 | 3.15 | 3.51 |
Group 1 Automotive Inc has consistently maintained a strong solvency position over the years, as indicated by its low debt-to-assets, debt-to-capital, and debt-to-equity ratios, all of which have remained at 0.00 throughout the period from December 31, 2020, to December 31, 2024. A debt-to-assets ratio of 0.00 means that the company has no debt in relation to its total assets, reflecting a low financial risk and high level of stability.
Furthermore, the financial leverage ratio, which measures the proportion of a company's total assets that are financed by debt, decreased from 3.51 in 2020 to 2.91 in 2023, before slightly increasing to 3.30 in 2024. Although there was a fluctuation in the financial leverage ratio, it remained within a reasonable range, indicating that Group 1 Automotive Inc has effectively managed its debt levels relative to its total assets over the years.
Overall, the solvency ratios suggest that Group 1 Automotive Inc has a conservative financial structure with minimal reliance on debt, which is favorable for investors and indicates a solid financial position.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 3.64 | 5.88 | 10.43 | 10.32 | 4.62 |
Group 1 Automotive Inc's interest coverage has shown variability over the past five years. Starting at 4.62 in December 2020, it improved to 10.32 by December 2021 and increased further to 10.43 by December 2022. However, there was a slight decline to 5.88 by December 2023, followed by a more significant decrease to 3.64 by December 2024.
The interest coverage ratio indicates the company's ability to meet its interest obligations with its operating income. A higher interest coverage ratio is generally interpreted positively as it demonstrates the company's ability to comfortably cover its interest expenses.
The trend observed in Group 1 Automotive Inc's interest coverage ratios shows mixed performance, with periods of improvement followed by declines. It is important for the company to monitor and maintain a healthy interest coverage ratio to ensure its ability to meet its debt obligations and manage financial risks effectively.