NetApp Inc (NTAP)
Solvency ratios
| Apr 30, 2024 | Apr 26, 2024 | Apr 30, 2023 | Apr 28, 2023 | Apr 30, 2022 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.20 | 0.00 | 0.24 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.63 | 0.00 | 0.67 | 0.00 |
| Debt-to-equity ratio | 0.00 | 1.74 | 0.00 | 2.06 | 0.00 |
| Financial leverage ratio | 8.63 | 8.63 | 8.47 | 8.47 | 11.96 |
NetApp Inc's solvency ratios reflect its ability to meet its long-term financial obligations. The debt-to-assets ratio, which measures the proportion of the company's assets financed by debt, shows a fluctuating trend over the years, decreasing from 0.24 in April 2023 to 0.20 in April 2024.
The debt-to-capital ratio, indicating the extent to which a company is leveraged, follows a similar pattern, declining from 0.67 in April 2023 to 0.63 in April 2024. This suggests that NetApp has been reducing its reliance on debt to fund its operations.
The debt-to-equity ratio, comparing the company's debt to equity, shows a decrease from 2.06 in April 2023 to 1.74 in April 2024. This signifies a stronger equity position relative to debt over the period.
The financial leverage ratio, measuring the company's proportion of debt to equity, remains relatively stable around 8.5 for the years under consideration. Overall, NetApp's solvency ratios indicate a prudent approach to managing its debt levels and maintaining a healthy balance between debt and equity financing.
Coverage ratios
| Apr 30, 2024 | Apr 26, 2024 | Apr 30, 2023 | Apr 28, 2023 | Apr 30, 2022 | |
|---|---|---|---|---|---|
| Interest coverage | 20.73 | 20.73 | 4.84 | 16.91 | 15.27 |
NetApp Inc's interest coverage ratio has shown varying trends over the period from April 30, 2022, to April 30, 2024. The interest coverage ratio, a measure of a company's ability to pay interest on its debt obligations, indicates the firm's capacity to meet its interest expenses from its earnings before interest and taxes (EBIT).
In April 2022, the interest coverage ratio was 15.27, indicating that NetApp Inc generated earnings that were 15.27 times its interest expenses for that period. This ratio improved significantly to 16.91 by April 2023, further reflecting the company's better ability to cover its interest payments.
However, there was a notable decline in the interest coverage ratio in April 2023, dropping to 4.84, which could be a cause for concern as it indicates that NetApp Inc's ability to cover its interest expenses had decreased significantly during that period.
Nevertheless, the company rebounded strongly in April 2024, with the interest coverage ratio increasing to 20.73, reflecting a robust ability to meet interest obligations relative to its earnings.
Overall, based on the trend observed in the interest coverage ratios, NetApp Inc seems to have performed well in managing its interest expenses, with the exception of a temporary decline in April 2023. Maintaining a high interest coverage ratio is crucial for financial health and indicates a company's ability to meet its debt obligations comfortably.