Grand Canyon Education Inc (LOPE)
Solvency ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.09 | 0.06 | 0.06 | 0.04 | 0.00 | 0.03 | 0.04 | 0.04 | 0.05 | 0.05 | 0.06 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.11 | 0.08 | 0.07 | 0.05 | 0.00 | 0.04 | 0.04 | 0.05 | 0.05 | 0.06 | 0.06 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.12 | 0.08 | 0.07 | 0.05 | 0.00 | 0.04 | 0.04 | 0.05 | 0.05 | 0.06 | 0.07 |
| Financial leverage ratio | 1.30 | 1.30 | 1.31 | 1.36 | 1.30 | 1.33 | 1.31 | 1.33 | 1.31 | 1.33 | 1.30 | 1.30 | 1.17 | 1.20 | 1.20 | 1.19 | 1.17 | 1.18 | 1.20 | 1.20 |
Grand Canyon Education Inc's solvency ratios have shown some fluctuations over the years.
1. Debt-to-assets ratio has been relatively low, starting at 0.06 in March 2020, and decreasing to 0.00 by September 2021. However, there was a slight increase by September 2022 and December 2022, before dropping back to 0.00 by the end of December 2023 and throughout 2024.
2. Debt-to-capital ratio has followed a similar trend to the debt-to-assets ratio, starting at 0.06 in March 2020, reaching 0.00 by September 2021, increasing until September 2022, and then decreasing to 0.00 from December 2022 to December 2024.
3. Debt-to-equity ratio also exhibited a downward trend similar to the other solvency ratios, with a drop to 0.00 by September 2021, before rising in 2022 and 2023, and eventually settling at 0.00 from December 2023 to December 2024.
4. The financial leverage ratio increased over the years, starting at 1.20 in March 2020, reaching its peak in March 2024 at 1.36. This indicates an increase in the company's financial leverage over time, which may imply higher financial risk.
Overall, the company's solvency ratios reflect a general trend of decreasing debt levels relative to assets, capital, and equity, while the financial leverage ratio has been increasing, suggesting a gradual shift towards higher financial leverage and potential risk.
Coverage ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 69,782.00 | 27,987.00 | 25,088.36 | 16,955.31 | 7,869.94 | 10,456.00 | 10,561.91 | 11,384.81 | 120,060.50 | 198.22 | 138.26 | 111.94 | 93.00 | 106.38 | 102.41 | 93.22 | 76.68 | 49.76 | 39.41 | 32.84 |
The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher interest coverage ratio indicates that the company is more capable of servicing its debt obligations from its operating income.
Analyzing Grand Canyon Education Inc's interest coverage data from March 31, 2020, to December 31, 2024, we observe a fluctuating trend. The interest coverage ratio increased from 32.84 on March 31, 2020, to a peak of 198.22 on September 30, 2022, signaling a significant improvement in the company's ability to cover its interest expenses comfortably.
However, a sharp decline is noted in the interest coverage ratio on December 31, 2022, with a notable figure of 120,060.50. This outlier may be due to unusual financial activities during that period, such as significant non-recurring income inflows that distorted the ratio.
The interest coverage ratio returned to more realistic levels in the following quarters, hovering around more reasonable figures. Further, fluctuations were observed in subsequent periods, with ratios ranging from 7,869.94 on December 31, 2023, to 69,782.00 on December 31, 2024.
In conclusion, Grand Canyon Education Inc's interest coverage ratio exhibited variability over the analyzed period, with occasional spikes and drops. It is essential for stakeholders to carefully assess the reasons behind extreme values to get a more accurate picture of the company's financial health and debt servicing capabilities.