KLA-Tencor Corporation (KLAC)
Solvency ratios
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.37 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.57 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 1.30 |
| Financial leverage ratio | 4.58 | 4.82 | 8.99 | 3.04 | 3.48 |
Based on the solvency ratios of KLA-Tencor Corporation over the past five years, we can observe a consistent trend of decreasing leverage and debt ratios, indicating a strengthening solvency position.
The debt-to-assets, debt-to-capital, and debt-to-equity ratios have remained consistently at 0.00 from 2020 to 2024, signifying that the company has not utilized debt to finance its assets, capital structure, or equity, respectively. This suggests a conservative approach to financing and a lower level of financial risk.
The financial leverage ratio, which measures the extent of debt in the company's capital structure, has shown a decreasing trend from 8.99 in 2022 to 4.58 in 2024. This decline indicates a decreasing reliance on debt to fund operations and investments, contributing to improved financial stability and reduced financial risk.
Overall, the downward trend in leverage and debt ratios suggests that KLA-Tencor Corporation has been able to reduce its debt levels relative to its assets, capital, and equity over the years, enhancing its solvency position and financial health. This trend reflects a prudent financial strategy aimed at maintaining a solid financial footing and minimizing the risk of financial distress.
Coverage ratios
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 9.94 | 13.76 | 22.76 | 16.01 | 9.23 |
The interest coverage ratio for KLA-Tencor Corporation has shown some fluctuations over the past five years. The ratio was 9.23 in 2020, increased to 16.01 in 2021, then further increased to 22.76 in 2022, before decreasing to 13.76 in 2023 and 9.94 in 2024.
A higher interest coverage ratio indicates that the company is more capable of meeting its interest payment obligations using its operating income. The significant drop in the interest coverage ratio from 2022 to 2024 may raise concerns about the company's ability to cover its interest expenses comfortably in more recent years.
Overall, while the company has demonstrated varying degrees of strength in its ability to cover interest payments in the past, it is important to closely monitor this ratio to ensure the company's continued ability to meet its debt obligations.