Kontoor Brands Inc (KTB)

Kontoor Brands Inc's solvency ratios indicate the company's ability to meet its financial obligations in the long term.

The debt-to-assets ratio has been trending downwards over the past five years, from 0.60 in 2019 to 0.46 in 2023. This suggests that Kontoor Brands Inc has been decreasing its reliance on debt to finance its assets, leading to a stronger financial position.

Similarly, the debt-to-capital ratio has also shown a decreasing trend, declining from 0.93 in 2019 to 0.67 in 2023. This indicates that the company's overall capital structure has become less debt-dependent, which is a positive sign for investors and creditors.

The debt-to-equity ratio has experienced a significant improvement over the years, dropping from 13.19 in 2019 to 2.05 in 2023. This decline indicates that the company has reduced its debt relative to its shareholder equity, improving its financial leverage and solvency position.

Lastly, the financial leverage ratio has also decreased significantly, from 21.91 in 2019 to 4.42 in 2023. This suggests that Kontoor Brands Inc has been reducing its reliance on debt financing, which has positively impacted its financial leverage and overall solvency.

In summary, Kontoor Brands Inc's solvency ratios have shown a consistent improvement over the years, reflecting the firm's efforts to strengthen its financial position and reduce its debt burden.

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Coverage ratios

The interest coverage ratio of Kontoor Brands Inc has exhibited fluctuations over the past five years. In particular, the ratio stood at 7.73 in 2023, lower than the previous year's value of 10.14. Although the 2023 ratio indicates that the company generated sufficient operating income to cover its interest expense, the decline from the prior year suggests a potentially reduced ability to meet interest obligations.

Furthermore, the interest coverage ratio in 2023 was higher compared to 2021 and 2020, reflecting an improvement in the company's ability to service its interest payments during the most recent year. However, the ratio remains lower compared to the levels recorded in 2019, indicating a potential weakening of the company's financial position in terms of interest coverage over a longer timeframe.

Overall, the analysis of Kontoor Brands Inc's interest coverage ratios suggests fluctuations in the company's ability to cover its interest expenses over the past five years. It is important for investors and stakeholders to monitor this metric closely to assess the company's financial health and ability to meet its debt obligations.