Prestige Brand Holdings Inc (PBH)

Prestige Brand Holdings Inc's solvency ratios have shown improvement over the past five years. The debt-to-assets ratio has declined from 0.49 in 2020 to 0.34 in 2024, indicating that the company has reduced its reliance on debt to finance its assets. This trend suggests an improvement in the company's asset coverage by debt.

Similarly, the debt-to-capital ratio has decreased from 0.60 in 2020 to 0.40 in 2024, signaling a positive shift in the company's capital structure towards a more equity-funded position. The decreasing trend in both the debt-to-assets and debt-to-capital ratios reflects a healthier balance between debt and equity in the company's capital structure.

Moreover, the debt-to-equity ratio has shown a notable decline from 1.48 in 2020 to 0.68 in 2024, indicating a significant improvement in the company's solvency position and decreased financial risk. This reduction suggests that Prestige Brand Holdings Inc has been successful in decreasing its debt relative to equity, which is a positive sign for creditors and investors.

Furthermore, the financial leverage ratio has also improved over the years, declining from 3.00 in 2020 to 2.00 in 2024. This trend indicates that the company has reduced its reliance on debt financing and is using more equity to support its operations, leading to a more sustainable financial structure.

Overall, the downward trends in these solvency ratios suggest that Prestige Brand Holdings Inc has been successfully managing its debt levels and enhancing its financial stability and solvency over the analyzed period.

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Coverage ratios

Prestige Brand Holdings Inc's interest coverage ratio has been fluctuating over the past five years. In 2024, the interest coverage ratio improved significantly to 54.08, indicating that the company earned 54 times the amount needed to cover its interest expenses. This is a positive sign, suggesting that the company's profitability is strong enough to cover its interest obligations comfortably.

On the other hand, in 2023, the interest coverage ratio was negative at -5.09, reflecting that the company's earnings were insufficient to cover its interest expenses during that period. This could be a cause for concern as it indicates a potential risk of financial distress due to high debt levels or low earnings.

In 2022, the interest coverage ratio was 5.11, demonstrating that the company's earnings were more than five times its interest expenses. This was a good improvement from the previous year, indicating a strengthened ability to meet interest payments.

Similarly, in 2021 and 2020, the interest coverage ratios were 3.60 and 3.01 respectively, showing a consistent ability to cover interest expenses with earnings. However, these ratios are relatively lower than the 2024 ratio, indicating a higher risk of financial distress compared to the most recent year.

Overall, the trend in Prestige Brand Holdings Inc's interest coverage ratio suggests fluctuating performance in terms of the company's ability to meet its interest obligations with its earnings. It is important for investors and stakeholders to monitor this ratio closely to assess the company's financial health and risk profile.