Iridium Communications Inc (IRDM)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.51 | 0.51 | 0.49 | 0.41 |
| Debt-to-capital ratio | 0.00 | 0.57 | 0.56 | 0.54 | 0.50 |
| Debt-to-equity ratio | 0.00 | 1.32 | 1.26 | 1.16 | 1.01 |
| Financial leverage ratio | 3.00 | 2.62 | 2.47 | 2.37 | 2.48 |
Solvency ratios provide insights into a company's ability to meet its long-term financial obligations. Looking at the solvency ratios of Iridium Communications Inc over the past five years, we observe the following trends:
1. Debt-to-assets ratio: This ratio has shown a slight increasing trend over the years, indicating that the company's reliance on debt to finance its assets has been growing. The ratio was 0.56 in 2023, up from 0.49 in 2019.
2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio has been increasing, reaching 0.63 in 2023 from 0.55 in 2019. This suggests that a larger portion of Iridium's capital structure is funded by debt.
3. Debt-to-equity ratio: The debt-to-equity ratio has also exhibited an upward trend, standing at 1.67 in 2023 compared to 1.22 in 2019. This indicates that the company's debt levels have been increasing relative to its equity.
4. Financial leverage ratio: The financial leverage ratio, which measures the company's debt relative to its equity, has been on the rise, reaching 3.00 in 2023 from 2.48 in 2019. This signifies that Iridium Communications Inc has been increasingly relying on debt to finance its operations.
Overall, the increasing trends in these solvency ratios suggest that Iridium Communications Inc's financial leverage and reliance on debt have been growing over the years, which could potentially raise concerns regarding the company's long-term financial stability and ability to service its debt obligations. Investors and stakeholders may want to closely monitor these ratios to assess the company's solvency position and financial risk going forward.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 0.26 | 1.06 | 0.64 | 0.36 | 0.07 |
Iridium Communications Inc's interest coverage has fluctuated over the past five years, ranging from 0.09 in 2019 to 1.16 in 2022. The interest coverage ratio indicates the company's ability to cover its interest expenses with its operating income. A ratio below 1 suggests that the company is not generating enough operating income to cover its interest payments, which may raise concerns about its financial stability and ability to meet its debt obligations.
Iridium's interest coverage decreased from 2022 to 2023, indicating a tighter relationship between its operating income and interest expenses. This decline in the ratio may signal increased financial risk for the company.
Overall, Iridium Communications Inc's interest coverage appears to be on the lower side, reflecting potential challenges in meeting its interest obligations. It would be advisable for investors and stakeholders to closely monitor the company's financial performance and debt management strategies.