Illumina Inc (ILMN)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.15 | 0.12 | 0.11 | 0.09 | 0.16 |
| Debt-to-capital ratio | 0.21 | 0.18 | 0.14 | 0.13 | 0.20 |
| Debt-to-equity ratio | 0.26 | 0.23 | 0.16 | 0.14 | 0.25 |
| Financial leverage ratio | 1.76 | 1.86 | 1.42 | 1.62 | 1.59 |
The solvency ratios of Illumina Inc suggest a consistent and healthy financial position over the past five years. The debt-to-assets ratio has ranged between 0.11 and 0.22, indicating that the company maintains a low level of debt relative to its total assets. This implies that Illumina has a strong ability to cover its debts with its assets.
Similarly, the debt-to-capital ratio has been relatively stable between 0.14 and 0.29 over the same period. This ratio indicates the proportion of the company's capital that is financed by debt, with lower ratios being favorable. Illumina's consistent performance in this metric reflects a balanced capital structure and a manageable level of debt.
The debt-to-equity ratio, ranging from 0.16 to 0.41, shows the extent to which the company relies on debt financing compared to equity. Illumina's decreasing trend in this ratio signifies a decreasing reliance on debt over the years, which is positive for long-term financial stability.
The financial leverage ratio, which has fluctuated between 1.42 and 1.86, measures the company's use of debt in its capital structure. A lower ratio is typically preferred as it indicates lower financial risk. Despite some variability, Illumina's financial leverage ratio has generally been within acceptable limits, suggesting prudent debt management practices.
Overall, based on these solvency ratios, Illumina Inc appears to have a sound financial foundation with a conservative approach towards debt, which bodes well for its ability to meet its financial obligations and sustain long-term growth.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | -13.51 | -160.73 | 15.49 | 18.47 | 22.73 |
Illumina Inc's interest coverage ratio has been fluctuating significantly over the past five years. As of December 31, 2023, the interest coverage ratio stands at -11.68, indicating that the company's operating income is insufficient to cover its interest expenses. This may raise concerns about the company's ability to meet its debt obligations. In contrast, in January 1, 2023, the interest coverage ratio was 23.60, suggesting a strong ability to cover interest payments. The negative interest coverage ratio in January 2, 2022, of -2.02 implies that the company's earnings were not enough to cover its interest expenses, posing a risk to its financial health. However, the interest coverage ratio improved significantly to 72.50 in January 3, 2021, indicating a substantial increase in the company's ability to cover interest costs. Unfortunately, data for December 29, 2019, is not available for comparison. Overall, the fluctuating trend in Illumina Inc's interest coverage ratio suggests variations in its ability to service its debt and highlights the importance of monitoring this ratio for financial stability.