Old Dominion Freight Line Inc (ODFL)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.01 | 0.02 | 0.02 | 0.02 | 0.00 |
| Debt-to-capital ratio | 0.02 | 0.02 | 0.03 | 0.03 | 0.00 |
| Debt-to-equity ratio | 0.02 | 0.03 | 0.03 | 0.03 | 0.00 |
| Financial leverage ratio | 1.29 | 1.32 | 1.31 | 1.31 | 1.20 |
Old Dominion Freight Line, Inc. demonstrates a strong solvency position based on its historical solvency ratios. The company's debt-to-assets ratio has remained consistently low over the past five years, indicating that only a minimal portion of its assets is funded by debt. This suggests that the company relies more on equity financing, which can be viewed positively by investors and creditors.
Similarly, the debt-to-capital and debt-to-equity ratios have also shown a stable and low trend over the same period. These ratios reflect the proportion of the company's capital structure that is financed by debt, with Old Dominion Freight Line maintaining a healthy balance between debt and equity.
Furthermore, the financial leverage ratio, which indicates the company's ability to meet its financial obligations through debt financing, has been relatively stable and well-managed. The ratios have consistently been around the 1.30-1.32 range, suggesting that the company has a modest level of financial leverage and is not overly reliant on debt to fund its operations.
Overall, the solvency ratios of Old Dominion Freight Line, Inc. reflect a prudent and conservative approach to capital structure management, with a focus on maintaining a strong financial position and mitigating financial risk.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 3,535.93 | 1,177.63 | 890.34 | 525.12 | 294.29 |
Old Dominion Freight Line, Inc. had an interest coverage ratio of 1,478.85 in 2021, reflecting a significant ability to cover interest expenses with its operating profits. This ratio increased from 952.61 in 2020, indicating an improvement in the company's capacity to meet its interest obligations. However, the data for other years is unavailable for a complete trend analysis. A high interest coverage ratio suggests that the company is capable of servicing its debt, which could indicate financial stability and lower default risk. It implies that Old Dominion Freight Line, Inc. had ample earnings to cover its interest expenses in 2021, reflecting positively on its financial health.