Lantheus Holdings Inc (LNTH)

Lantheus Holdings Inc's solvency ratios provide insights into the company's financial leverage and ability to meet its debt obligations. The trends observed in the ratios over the past five years indicate changes in the company's financial structure and risk profile.

The debt-to-assets ratio shows the proportion of the company's assets financed by debt. A lower ratio is generally considered favorable as it suggests lower financial risk. Lantheus Holdings Inc's debt-to-assets ratio has fluctuated over the years, decreasing from 0.48 in 2019 to 0.34 in 2023. This indicates that the company has reduced its reliance on debt to finance its assets, which is a positive sign of improved solvency.

The debt-to-capital ratio measures the percentage of the company's capital that is financed by debt. A lower ratio indicates a lower dependence on debt for funding. Lantheus Holdings Inc's debt-to-capital ratio has also shown improvement over the years, declining from 0.63 in 2019 to 0.41 in 2023. This suggests that the company has enhanced its capital structure by reducing the proportion of debt in its overall capitalization.

The debt-to-equity ratio reflects the extent to which the company is using debt to finance its operations compared to equity. A lower ratio indicates a lower financial risk and better solvency. Lantheus Holdings Inc's debt-to-equity ratio has decreased steadily from 1.69 in 2019 to 0.69 in 2023, indicating a positive trend towards a healthier balance between debt and equity financing.

The financial leverage ratio measures the company's total assets relative to its equity, indicating the level of financial risk and the company's ability to withstand downturns. Lantheus Holdings Inc's financial leverage ratio has shown a declining trend, indicating improvement in financial stability and the company's ability to generate profits to cover its debt obligations.

Overall, the improving solvency ratios of Lantheus Holdings Inc suggest a more stable financial position, reduced financial risk, and stronger ability to meet its debt obligations over the years. This trend may be indicative of prudent financial management and operational efficiency within the company.

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Coverage ratios

Lantheus Holdings Inc's interest coverage ratio has exhibited significant fluctuations over the past five years. The interest coverage ratio measures the company's ability to cover its interest expenses with its operating income.

In 2023, the interest coverage ratio significantly improved to 957.07, indicating that the company's operating income was substantially higher relative to its interest expenses. This suggests a strong financial position and capability to meet its debt obligations comfortably.

In 2022, the interest coverage ratio was 7.92, reflecting a notable decrease compared to the previous year. While the company's operating income was still able to cover its interest expenses, the ratio was much lower, signaling a potential increase in financial risk.

In 2021, the interest coverage ratio was negative at -9.87, indicating that the company's operating income was insufficient to cover its interest expenses. This suggests financial distress and an inability to meet debt obligations solely based on operating income.

Similarly, in 2020, the interest coverage ratio was -0.45, highlighting a continued deficiency in covering interest expenses with operating income.

In 2019, the interest coverage ratio improved to 4.00, indicating a better ability to cover interest costs with operating income compared to the previous two years, but still below the ideal ratio of 1 or higher.

Overall, Lantheus Holdings Inc's interest coverage has shown significant fluctuations, with 2023 demonstrating a remarkable improvement, while 2021 and 2020 reflected challenging financial positions. It is essential for the company to maintain a healthy interest coverage ratio to ensure its ability to manage debt obligations effectively in the long term.