Humana Inc (HUM)
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 | 2.84 | 2.89 | 2.81 | 2.76 | 2.55 |
Based on the provided data for Humana Inc, the solvency ratios reflect a strong financial position with consistently low levels of debt relative to assets, capital, and equity over the years from 2020 to 2024. The Debt-to-assets ratio, Debt-to-capital ratio, and Debt-to-equity ratio all show a consistent reading of 0.00 across the five years, indicating that the company has minimal or no debt in relation to its total assets, capital, and equity.
Furthermore, the Financial leverage ratio, which is a measure of the company's financial risk and indicates the extent to which the company relies on debt financing, has remained relatively stable over the period, ranging from 2.55 in 2020 to 2.84 in 2024. This suggests that Humana Inc has been maintaining a conservative approach towards leverage and has not significantly increased its reliance on debt to finance its operations.
Overall, the solvency ratios reflect a prudent financial management strategy by Humana Inc, with minimal debt levels and a stable financial leverage position, indicating a strong ability to meet its financial obligations and maintain financial stability in the long term.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 3.88 | 8.14 | 9.48 | 9.66 | 17.62 |
Based on the interest coverage ratios for Humana Inc over the years provided in the data:
- On December 31, 2020, the interest coverage ratio was 17.62, indicating that the company's operating income was substantially higher than its interest expenses, reflecting a strong ability to cover interest payments with operating earnings.
- By December 31, 2021, the interest coverage ratio decreased to 9.66. Although still above 1, this decline suggests a reduction in the company's ability to cover its interest payments comfortably compared to the previous year.
- Similarly, by December 31, 2022, the interest coverage ratio fell further to 9.48, indicating a continued decrease in the company's ability to cover its interest expenses from its operating income.
- On December 31, 2023, the interest coverage ratio dropped to 8.14, signaling a further decrease in the company's ability to service its debt obligations with its operating earnings.
- Finally, by the end of December 31, 2024, the interest coverage ratio decreased to 3.88, showing a significant decline in Humana Inc's ability to cover its interest payments with its operating income, raising concerns about the company's financial health and its ability to meet its debt obligations comfortably.
Overall, the trend in the interest coverage ratios indicates a decreasing ability of Humana Inc to meet its interest expenses from its operating profits over the years, highlighting a potential strain on the company's financial position and debt servicing capability.