Henry Schein Inc (HSIC)
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 | 3.01 | 2.89 | 2.50 | 2.48 | 2.32 |
Based on the provided data for Henry Schein Inc's solvency ratios:
1. Debt-to-assets ratio:
- The debt-to-assets ratio for Henry Schein Inc has consistently been 0.00 over the years 2020 to 2024. This indicates that the company has not used debt to finance its assets during this period. A lower debt-to-assets ratio suggests lower financial risk and greater financial stability.
2. Debt-to-capital ratio:
- Similar to the debt-to-assets ratio, the debt-to-capital ratio for Henry Schein Inc has remained 0.00 from 2020 to 2024. This implies that the company has not relied on debt to fund its operations or investments, maintaining a strong capital structure.
3. Debt-to-equity ratio:
- The debt-to-equity ratio for Henry Schein Inc has also been 0.00 across the years 2020 to 2024. This indicates that the company's equity has fully funded its operations without taking on any debt. A lower debt-to-equity ratio signifies lower financial risk and a healthy balance between debt and equity.
4. Financial leverage ratio:
- The financial leverage ratio for Henry Schein Inc has increased from 2.32 in 2020 to 3.01 in 2024. This suggests that the company's reliance on debt has been gradually rising over the years, resulting in higher financial leverage. While a moderate level of financial leverage can amplify returns, it also increases financial risk.
In summary, Henry Schein Inc has maintained a conservative approach towards leveraging debt to finance its operations, with a consistent absence of debt in its capital structure. However, the increasing trend in the financial leverage ratio indicates a slight shift towards utilizing debt for funding in recent years. It is important for the company to monitor its debt levels and ensure a balanced approach to maintain its solvency and financial health.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 4.95 | 7.16 | 21.49 | 30.61 | 13.17 |
The interest coverage ratio of Henry Schein Inc has demonstrated fluctuations over the past five years.
At the end of December 31, 2020, the interest coverage ratio stood at 13.17, indicating that the company earned 13.17 times the amount of interest expenses incurred during that period. This suggests a moderate level of financial strength to cover interest obligations.
By the end of December 31, 2021, the interest coverage ratio significantly improved to 30.61, reflecting a strong ability to meet interest payments from operating earnings.
In the subsequent year, as of December 31, 2022, the interest coverage ratio decreased to 21.49, but still remained at a healthy level, indicating that the company's profitability was sufficient to cover interest charges comfortably.
However, as of December 31, 2023, there was a notable decline in the interest coverage ratio to 7.16, signaling a potential strain on the company's ability to meet interest obligations solely through operating profits.
The trend continued to worsen by the end of December 31, 2024, with the interest coverage ratio further decreasing to 4.95. This sharp decline suggests a considerable decrease in the company's ability to cover interest expenses with its operating earnings.
Overall, the fluctuation in Henry Schein Inc's interest coverage ratio over the years indicates varying levels of financial strength and ability to manage interest payments, with recent years showing a concerning downward trend in the company's ability to cover its interest expenses.