Paycom Soft (PAYC)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.01 | 0.01 | 0.01 | 0.01 |
| Debt-to-capital ratio | 0.00 | 0.02 | 0.03 | 0.04 | 0.06 |
| Debt-to-equity ratio | 0.00 | 0.02 | 0.03 | 0.04 | 0.06 |
| Financial leverage ratio | 3.22 | 3.30 | 3.60 | 3.98 | 4.72 |
Paycom Software Inc has consistently maintained a low level of indebtedness over the past five years, as indicated by its solvency ratios. The debt-to-assets ratio has remained stable at 0.01 from 2020 to 2023, suggesting that the company finances a negligible portion of its assets through debt.
Similarly, the debt-to-capital and debt-to-equity ratios have also shown a downward trend over the years, indicating that the company relies less on debt to finance its operations and investments. The debt-to-capital ratio decreased from 0.06 in 2019 to 0.03 in 2021, while the debt-to-equity ratio declined from 0.06 in 2019 to 0.03 in 2021.
The financial leverage ratio, which measures the extent to which the company relies on debt to finance its assets, has also shown a decreasing trend over the years. From 4.72 in 2019, the ratio decreased to 3.22 in 2023. This indicates that Paycom Software Inc has been able to reduce its financial leverage and improve its overall solvency position.
Overall, the solvency ratios of Paycom Software Inc reflect a strong financial position with minimal reliance on debt for financing its operations and investments. Investors and creditors may view the company favorably due to its prudent approach to managing its debt levels.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 246.15 | 154.62 | 176.58 | 9,787.11 | 241.52 |
The interest coverage ratio for Paycom Software Inc has shown significant volatility over the past five years. In 2019, the ratio was relatively stable at 240.66, indicating the company's ability to cover its interest expenses nearly 240 times with its operating income. However, in 2020, the interest coverage ratio saw a substantial decrease to 9,795.95, which may suggest a temporary anomaly or a significant increase in operating income compared to interest expenses.
The lack of data for 2021 is a gap in the analysis, limiting the ability to assess the company's performance in that year. In 2022, the interest coverage ratio improved to 149.32, signaling a recovery in the company's ability to cover its interest obligations with operating earnings. Notably, in 2023, the interest coverage ratio surged to 234.21, indicating a further strengthening of the company's ability to service its debt.
Overall, Paycom Software Inc's interest coverage has shown both positive and negative fluctuations, reflecting changes in operating income and interest expenses over the years. The company's ability to cover its interest payments has generally been strong, with occasional anomalies that warrant further investigation to understand the underlying factors driving the fluctuations in the interest coverage ratio.