HCA Holdings Inc (HCA)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.66 | 0.72 | 0.68 | 0.65 | 0.75 |
| Debt-to-capital ratio | 1.05 | 1.08 | 1.03 | 0.98 | 1.09 |
| Debt-to-equity ratio | — | — | — | 53.84 | — |
| Financial leverage ratio | — | — | — | 83.02 | — |
The solvency ratios of HCA Healthcare Inc over the past five years show the company's ability to meet its long-term financial obligations. The debt-to-assets ratio has fluctuated within a range of 0.65 to 0.75, indicating that, on average, 70% of the company's assets are financed by debt. This ratio suggests that HCA Healthcare relies moderately on debt to fund its operations and investments.
The debt-to-capital ratio has similarly shown fluctuations, ranging from 0.98 to 1.09, with an average of 1.05 over the period. This ratio reflects that, on average, 105% of the company's capital structure is attributed to debt. This implies that HCA Healthcare's capital is fairly leveraged, and a higher proportion of their capital comes from debt financing.
The absence of data for the debt-to-equity ratio in 2021 and 2019 limits our ability to provide a comprehensive analysis of how the company's debt is structured relative to its equity. However, the data available for 2020 shows a significantly high ratio of 54.20, indicating that the company had a high level of debt compared to its equity that year.
The financial leverage ratio, not available for the most recent years, was notably high in 2020 at 83.02, suggesting a higher degree of financial leverage in that year. This ratio indicates the extent to which the company's assets are financed by debt, with a higher value suggesting higher financial risk.
Overall, the solvency ratios of HCA Healthcare Inc highlight the company's reliance on debt financing to support its operations and investments. Fluctuations in these ratios over the years may indicate changes in the company's capital structure and debt management strategies, which should be carefully monitored for potential implications on the company's long-term financial health and stability.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 4.54 | 5.24 | 6.79 | 4.03 | 3.52 |
The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. In the case of HCA Healthcare Inc, the interest coverage ratio has shown a generally positive trend over the past five years.
The interest coverage ratio for HCA Healthcare Inc was 4.98 in 2023, which indicates that the company generated enough operating income to cover its interest expenses nearly 5 times. This ratio was slightly lower than in 2022 when it was 5.23. However, both ratios are above 3, which is generally considered the minimum acceptable level for healthy interest coverage.
Looking back to 2021, the interest coverage ratio was 6.25, reflecting an even stronger ability to cover interest expenses. The ratio decreased in 2020 to 4.62 but rebounded from 2019 when it was 3.98, indicating an improvement in the company's ability to meet its interest obligations.
Overall, a higher interest coverage ratio indicates that HCA Healthcare Inc has been more capable of meeting its interest payment obligations using its operating income. This trend suggests that the company's financial health in terms of its debt-servicing ability has been relatively stable and improving over the past five years.