Macy’s Inc (M)

Macy's Inc solvency ratios provide insights into its financial health and ability to meet its debt obligations.

1. Debt-to-assets ratio:
- The Debt-to-assets ratio measures the proportion of Macy's assets financed by debt.
- Macy's Debt-to-assets ratio ranged from 0.00 to 0.17 over the period, indicating a low level of debt relative to its assets.
- A lower ratio signifies lower financial risk and greater solvency.

2. Debt-to-capital ratio:
- The Debt-to-capital ratio shows the extent to which Macy's capital structure is reliant on debt financing.
- Macy's Debt-to-capital ratio ranged from 0.00 to 0.40, suggesting a mix of debt and equity in funding operations.
- A lower ratio indicates a healthier capital structure, with less reliance on debt.

3. Debt-to-equity ratio:
- The Debt-to-equity ratio highlights the proportion of Macy's financing that comes from creditors versus shareholders.
- Macy's Debt-to-equity ratio ranged from 0.00 to 0.65, showing varying levels of debt relative to equity.
- A lower ratio is generally preferred as it indicates lower financial leverage.

4. Financial leverage ratio:
- The Financial leverage ratio indicates Macy's reliance on debt to finance its assets.
- Macy's Financial leverage ratio decreased from 4.13 to 3.60, signaling a decrease in financial risk and potentially improved solvency.
- A declining ratio indicates a reduction in financial leverage and a stronger financial position.

In conclusion, Macy's Inc's solvency ratios demonstrate prudent management of debt and a solid financial position, with a consistent trend towards lower leverage and healthy capital structure.

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Coverage ratios

To analyze Macy’s Inc interest coverage based on the provided data:

1. The interest coverage ratio is a measure of a company's ability to pay its interest expenses on outstanding debt. A higher ratio indicates a stronger ability to meet interest obligations.

2. The interest coverage ratios for Macy’s Inc are as follows:
- January 28, 2023: 9.67
- January 31, 2023: 10.27
- January 31, 2024: 1.92
- February 3, 2024: 1.73
- January 31, 2025: 8.28

3. A ratio above 1 indicates that Macy’s Inc is generating enough operating income to cover its interest expenses. Hence, during January 28, 2024, and January 31, 2024, the interest coverage fell below 1, suggesting that Macy’s Inc may have faced challenges in meeting its interest obligations during those periods.

4. The increasing trend from January 28, 2023, to January 31, 2023, and the improvement in the interest coverage ratio on January 31, 2025, indicate that Macy’s Inc's ability to cover interest expenses has generally strengthened, except for the noted periods of concern.

5. It is important for Macy’s Inc to consistently monitor and manage its interest coverage ratio to ensure financial stability and avoid potential liquidity issues related to debt obligations.