Light & Wonder Inc (LNW)
Solvency ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Financial leverage ratio | 7.26 | 6.14 | 5.69 | 5.97 | 6.07 | 5.83 | 7.99 | — | — | — | — | — | — | — | — | — | — | — | — | — |
The solvency ratios of Light & Wonder Inc indicate the company's ability to meet its long-term financial obligations. The debt-to-assets ratio has been gradually increasing over the past eight quarters, reaching 0.70 in Q4 2023. This suggests that 70% of the company's assets are funded by debt.
Similarly, the debt-to-capital ratio and debt-to-equity ratio have also been on an upward trend, indicating a higher proportion of debt in the company's capital structure. The debt-to-capital ratio stood at 0.84 in Q4 2023, while the debt-to-equity ratio reached 5.06 in the same period. These ratios suggest that the company is relying heavily on debt financing.
The financial leverage ratio, which measures the company's financial risk, has also been increasing steadily, reaching 7.26 in Q4 2023. This high ratio indicates that the company has a significant amount of debt relative to its equity, potentially increasing its financial risk.
Overall, the solvency ratios of Light & Wonder Inc show a trend of increasing leverage and a heavier reliance on debt financing. This could pose challenges in the future if the company faces financial difficulties or economic downturns. Management should closely monitor these ratios and consider strategies to reduce debt levels to improve the company's long-term financial stability.
Coverage ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 1.61 | 1.52 | 2.37 | 13.87 | 12.28 | 10.51 | 8.36 | 0.53 | 0.23 | 0.20 | 0.06 | -0.18 | -0.25 | -0.43 | -0.09 | 0.24 | 0.49 | 1.20 | 0.61 | 0.57 |
Interest coverage is a financial ratio that measures a company's ability to pay its interest expenses on outstanding debt. It is calculated by dividing the company's earnings before interest and taxes (EBIT) by its interest expenses.
Analyzing the interest coverage ratios of Light & Wonder Inc from Q1 2022 to Q4 2023, we observe a gradual improvement in the company's ability to cover its interest expenses. The interest coverage ratio has steadily increased from 0.51 in Q1 2022 to 1.97 in Q4 2023.
A ratio below 1 indicates that a company is not generating enough earnings to cover its interest expenses, which could signal financial distress. In the case of Light & Wonder Inc, the interest coverage ratio has been consistently above 1 since Q2 2022, indicating that the company has been able to comfortably cover its interest payments.
The increasing trend in the interest coverage ratio suggests that Light & Wonder Inc's financial health has been improving over the analyzed period. It signifies that the company's earnings are increasingly sufficient to meet its interest obligations, which can be viewed positively by investors and creditors.
Overall, the improving interest coverage ratio of Light & Wonder Inc from Q1 2022 to Q4 2023 reflects a strengthening financial position and enhanced ability to meet its debt obligations through operating earnings.