Hexcel Corporation (HXL)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.26 | 0.24 | 0.25 | 0.29 | 0.32 |
| Debt-to-capital ratio | 0.31 | 0.29 | 0.32 | 0.36 | 0.38 |
| Debt-to-equity ratio | 0.46 | 0.41 | 0.47 | 0.55 | 0.61 |
| Financial leverage ratio | 1.78 | 1.70 | 1.83 | 1.90 | 1.93 |
From 2020 to 2024, Hexcel Corporation's solvency ratios show an improving trend, indicating a stronger financial position.
- The Debt-to-assets ratio decreased from 0.32 in 2020 to 0.26 in 2024, suggesting that the company's reliance on debt to finance its assets has been decreasing over the years.
- The Debt-to-capital ratio also declined from 0.38 in 2020 to 0.31 in 2024, indicating a lower proportion of debt in the company's capital structure.
- The Debt-to-equity ratio followed a similar pattern, decreasing from 0.61 in 2020 to 0.46 in 2024. This signifies a decreasing level of financial leverage and a stronger equity position.
- The Financial leverage ratio, which measures the company's total assets relative to equity, decreased from 1.93 in 2020 to 1.78 in 2024, indicating a decreasing dependency on debt to fund its assets.
Overall, the decreasing trend in these solvency ratios reflects Hexcel Corporation's efforts to improve its financial stability and reduce its reliance on debt, which bodes well for its long-term financial health and ability to weather financial challenges.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 5.96 | 6.33 | 4.84 | 1.35 | 0.30 |
The interest coverage ratio for Hexcel Corporation has shown a significant improvement over the past five years. Starting at a low point of 0.30 in 2020, the company's ability to cover interest expenses has steadily increased to 1.35 in 2021, 4.84 in 2022, 6.33 in 2023, and then slightly decreased to 5.96 in 2024. This upward trend indicates that the company's earnings before interest and taxes (EBIT) have been robust enough to cover its interest obligations, with a notable improvement in financial health and reduced risk of financial distress. The ratio exceeding 1 implies that Hexcel Corporation has sufficient earnings to meet its interest payments, with higher ratios suggesting stronger financial stability and reduced default risk.