Palo Alto Networks Inc (PANW)
Solvency ratios
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.16 | 0.34 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.72 | 0.74 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 2.63 | 2.80 |
| Financial leverage ratio | 3.87 | 8.29 | 58.35 | 16.14 | 8.23 |
The solvency ratios of Palo Alto Networks Inc reflect a consistently strong financial position over the five-year period analyzed. The debt-to-assets ratio has been consistently at 0.00, indicating that the company has not used debt to finance its assets during this period. This suggests a low level of financial risk and a healthy balance sheet structure.
Similarly, the debt-to-capital ratio and debt-to-equity ratio have also remained at 0.00 throughout the years, indicating that the company has not relied on debt financing to fund its operations or growth. This demonstrates the company's ability to operate without taking on excessive debt levels, which can be a positive signal for investors and creditors.
The financial leverage ratio has shown fluctuations over the years, but the overall trend indicates a manageable level of leverage. The ratio peaked in 2022 at 58.35, which may have been driven by specific financing activities during that period. However, the ratio decreased significantly in 2023 and remained relatively stable in subsequent years, indicating that the company has maintained a balance between equity and debt in its capital structure.
Overall, Palo Alto Networks Inc's solvency ratios highlight a prudent approach to financial management, with a low reliance on debt and a strong financial position to support its ongoing operations and growth initiatives.
Coverage ratios
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 120.07 | 21.82 | -6.56 | -1.85 | -1.61 |
Palo Alto Networks Inc's interest coverage ratio has shown significant fluctuations over the past five years. In the most recent fiscal year ending July 31, 2024, the interest coverage ratio improved substantially to 120.07, indicating a strong ability to cover interest expenses with operating profits. This contrasts with the previous year, where the ratio was 21.82, suggesting a notable increase in profitability and earnings relative to interest obligations.
However, in the fiscal year ending July 31, 2022, the interest coverage ratio was negative at -6.56, implying that the company's operating profit was insufficient to cover its interest expenses. This negative trend continued in the fiscal year ending July 31, 2021, and July 31, 2020, with interest coverage ratios of -1.85 and -1.61, respectively.
The fluctuating interest coverage ratios over the years indicate varying levels of financial risk and operational efficiency. The significant improvement in the interest coverage ratio in the most recent year is a positive sign, but the negative ratios in the previous years raise concerns about the company's ability to meet its interest payments. It is essential for investors and stakeholders to closely monitor Palo Alto Networks Inc's financial performance to ensure sustainable profitability and liquidity in the long term.