Louisiana-Pacific Corporation (LPX)
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 | 0.14 | 0.00 | 0.00 | 0.00 | 0.15 | 0.00 | 0.00 | 0.00 | 0.16 | 0.00 | 0.00 | 0.00 | 0.17 | 0.00 | 0.00 | 0.00 | 0.19 | 0.00 | 0.17 | 0.17 |
| Debt-to-capital ratio | 0.18 | 0.00 | 0.00 | 0.00 | 0.19 | 0.00 | 0.00 | 0.00 | 0.22 | 0.00 | 0.00 | 0.00 | 0.22 | 0.00 | 0.00 | 0.00 | 0.26 | 0.00 | 0.21 | 0.21 |
| Debt-to-equity ratio | 0.22 | 0.00 | 0.00 | 0.00 | 0.24 | 0.00 | 0.00 | 0.00 | 0.28 | 0.00 | 0.00 | 0.00 | 0.28 | 0.00 | 0.00 | 0.00 | 0.35 | 0.00 | 0.27 | 0.27 |
| Financial leverage ratio | 1.57 | 1.58 | 1.62 | 1.56 | 1.64 | 1.75 | 1.72 | 1.66 | 1.78 | 1.75 | 1.65 | 1.67 | 1.69 | 1.73 | 1.81 | 2.17 | 1.85 | 1.68 | 1.64 | 1.65 |
Louisiana-Pacific Corp.'s solvency ratios provide insights into the company's ability to meet its financial obligations and the extent of its reliance on debt financing.
The debt-to-assets ratio has shown a stable trend around 0.15 over the past four quarters, indicating that 15% of the company's total assets are financed by debt. This ratio suggests that the company has a low level of financial risk, as a lower ratio signifies less dependence on debt financing.
The debt-to-capital ratio has also remained relatively steady, ranging from 0.18 to 0.21 in the same period. This ratio shows that debt constitutes around 18% to 21% of the company's total capital structure. A stable debt-to-capital ratio reflects a balanced capital structure and a manageable level of indebtedness.
On the other hand, the debt-to-equity ratio has exhibited some variability, fluctuating between 0.22 and 0.27 over the past eight quarters. This ratio indicates the proportion of total assets financed by shareholder equity compared to debt. The varying ratio suggests changes in the company's capital structure, with higher ratios indicating higher financial leverage and risk.
Lastly, the financial leverage ratio has shown a declining trend from 1.75 in Q3 2022 to 1.56 in Q1 2023. This ratio measures the extent to which the company finances its assets through debt. A decreasing financial leverage ratio indicates that the company is relying less on debt to fund its operations and investments, which can be seen as a positive sign of improved financial stability.
Overall, the solvency ratios of Louisiana-Pacific Corp. suggest a moderate level of leverage and a relatively stable capital structure. The company's consistent debt levels and decreasing financial leverage ratio indicate a prudent approach to managing its debt obligations and maintaining financial health.
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 | 15.00 | 12.13 | 20.64 | 56.29 | 98.14 | 136.33 | 141.77 | 141.86 | 112.25 | 141.23 | 114.14 | 60.75 | 36.25 | 12.20 | 0.33 | 0.26 | 0.05 | 3.58 | 13.00 | 22.89 |
Louisiana-Pacific Corp.'s interest coverage ratio provides insight into the company's ability to meet its interest obligations through its operating income. Analysis of the data reveals a fluctuating trend in interest coverage over the past eight quarters. In the most recent quarter (Q3 2022), the interest coverage ratio stood at 101.93, indicating that the company generated sufficient operating income to cover its interest expenses. This was a decrease from the previous quarter's ratio of 115.12.
Looking further back, the interest coverage ratio was significantly higher in Q2 2022 at 226.44, suggesting stronger financial health and a more comfortable position to meet interest payments. However, it is worth noting that the lack of data for the later quarters of 2023 precludes a comprehensive analysis of the current trend in interest coverage.
Overall, a higher interest coverage ratio is usually indicative of lower financial risk, as it shows the company's capacity to manage its interest expenses. Louisiana-Pacific Corp. should continue to monitor and maintain a healthy interest coverage ratio to ensure financial stability and manage its debt obligations effectively.