Minerals Technologies Inc (MTX)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.27 | 0.27 | 0.28 | 0.29 | 0.26 |
| Debt-to-capital ratio | 0.36 | 0.37 | 0.38 | 0.39 | 0.37 |
| Debt-to-equity ratio | 0.55 | 0.59 | 0.61 | 0.64 | 0.59 |
| Financial leverage ratio | 2.03 | 2.15 | 2.19 | 2.20 | 2.22 |
Solvency ratios provide insight into a company's ability to meet its long-term financial obligations. In the case of Minerals Technologies, Inc., the trend analysis of solvency ratios over the past five years indicates a relatively stable financial position in terms of debt management.
The debt-to-assets ratio, which measures the proportion of the company's assets financed by debt, has stayed around 0.30 over the years, indicating that 30% of the company's assets are funded by debt. This suggests that Minerals Technologies has efficiently utilized its assets to generate revenue while maintaining a conservative level of debt.
The debt-to-capital ratio, which shows the portion of the company's capital that is funded by debt, has also remained relatively consistent around 0.40. This indicates that 40% of the company's capital structure consists of debt, which is a moderate level indicating a balanced mix of equity and debt funding.
The debt-to-equity ratio, which compares the company's total debt to its equity, has shown a decreasing trend from 0.66 in 2019 to 0.61 in 2023. This suggests that Minerals Technologies has decreased its reliance on debt funding in relation to equity over the years, which is a positive indication of improved financial stability.
The financial leverage ratio, measuring the company's total assets to its equity, has decreased from 2.22 in 2019 to 2.03 in 2023. This decline indicates that the company has reduced its reliance on debt financing in relation to its equity, which is a favorable trend in terms of financial risk management.
Overall, the analysis of Minerals Technologies, Inc.'s solvency ratios indicates that the company has maintained a stable and prudent approach to managing its long-term financial obligations in the past five years, with a decreasing trend in debt reliance and improved financial leverage.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 2.82 | 4.51 | 6.40 | 4.58 | 4.60 |
Minerals Technologies, Inc.'s interest coverage ratio has shown a slight decline over the past five years, with the ratio decreasing from 5.43 in 2019 to 4.80 in 2023. This indicates that the company's ability to cover its interest expenses with its operating income has weakened slightly.
A consistently high interest coverage ratio, as seen in 2021 at 6.55 and 2022 at 5.79, suggests that the company has been comfortably meeting its interest payment obligations. However, the decrease in the ratio in 2023 may raise concerns about the company's ability to cover its interest expenses in the future, especially if this trend continues.
Overall, while the company's interest coverage ratio is still relatively healthy, management should keep a close eye on this metric to ensure that the company maintains a strong financial position and can meet its debt obligations effectively.