Granite Construction Incorporated (GVA)
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 | 2.98 | 2.88 | 2.27 | 2.58 | 2.44 |
Granite Construction Incorporated has consistently shown a strong solvency position based on the solvency ratios provided.
1. Debt-to-assets ratio: The company maintains a debt-to-assets ratio of 0.00 across all the years analyzed. This indicates that Granite Construction's total debt is fully supported by its total assets, suggesting a low risk of insolvency related to the company's asset base.
2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio remains at 0.00 throughout the years under review. This ratio signifies that the company's debt is well managed within its capital structure, with no excessive reliance on debt to finance its operations.
3. Debt-to-equity ratio: The debt-to-equity ratio also remains constant at 0.00 over the years. This indicates that the company's debt level is negligible in relation to its shareholders' equity, reflecting a conservative approach to leverage and a strong financial position.
4. Financial leverage ratio: The financial leverage ratio has shown a slight fluctuation over the years, ranging from 2.27 to 2.98. Despite the variation, the ratio remains at a moderate level, implying that Granite Construction utilizes a reasonable amount of debt to support its operations without significantly increasing financial risk.
Overall, Granite Construction Incorporated demonstrates a prudent and sustainable solvency position, as evidenced by its stable and low solvency ratios. This suggests that the company has a healthy balance between debt and equity, indicating a reduced risk of financial distress and insolvency.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 7.72 | 4.24 | 5.62 | -2.06 | -3.84 |
Granite Construction Incorporated's interest coverage ratio has shown fluctuations over the years based on the provided data.
As of December 31, 2020, the interest coverage ratio was at a concerning level of -3.84, indicating that the company's operating income was insufficient to cover its interest expenses.
By December 31, 2021, the interest coverage ratio improved to -2.06 but still remained negative, suggesting that Granite Construction Incorporated continued to face challenges in meeting its interest obligations.
However, there was a significant improvement in the company's interest coverage ratio by December 31, 2022, reaching 5.62. This indicates that Granite Construction Incorporated's operating income was more than sufficient to cover its interest payments, reflecting a positive development in the company's financial performance.
The trend continued to be positive in the subsequent years, with the interest coverage ratios for December 31, 2023, and December 31, 2024, standing at 4.24 and 7.72, respectively. These figures suggest that Granite Construction Incorporated has been able to strengthen its ability to cover interest expenses over time.
Overall, the improvement in Granite Construction Incorporated's interest coverage ratio from negative to positive values indicates that the company has made progress in managing its debt and enhancing its financial stability. It is essential for investors and stakeholders to monitor this ratio to assess the company's ability to meet its debt obligations in the future.