Garmin Ltd (GRMN)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| 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 | 1.23 | 1.25 | 1.28 | 1.27 | 1.29 |
The solvency ratios of Garmin Ltd, namely the debt-to-assets ratio, debt-to-capital ratio, debt-to-equity ratio, and financial leverage ratio, have consistently remained at 0.00 for the past five years. This indicates that the company has not used debt to finance its operations or investments during this period.
However, the financial leverage ratio has fluctuated slightly over the years, standing at 1.23 in 2023, 1.25 in 2022, 1.28 in 2021, 1.27 in 2020, and 1.29 in 2019. Despite the increase in 2021, the ratio has since decreased, suggesting that Garmin Ltd has been using more equity financing compared to debt financing to support its assets.
Overall, the consistent low debt ratios and the decreasing trend in the financial leverage ratio indicate that Garmin Ltd has maintained a strong solvency position and has relied more on equity to fund its operations and investments. This approach has likely contributed to the company's financial stability and reduced financial risk over the years.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | — | 25.18 | 21.35 | 20.28 | 38.07 |
Interest coverage measures a company's ability to meet its interest expenses with its operating income. A higher interest coverage ratio indicates that the company is more capable of servicing its debt.
Looking at Garmin Ltd's interest coverage over the past five years, we observe that it has been relatively strong and consistent. In 2019, the interest coverage ratio was particularly high at 38.07, indicating a robust ability to cover interest expenses with operating income. However, this ratio declined in the subsequent years but remained above 20, reflecting a solid financial position.
The absence of data for December 31, 2023, limits the ability to provide a complete trend analysis. Nonetheless, based on the available information, Garmin Ltd has demonstrated a consistent ability to cover its interest expenses comfortably over the past five years, suggesting a stable financial position with sufficient earnings to manage its debt obligations.