Pacira Pharmaceuticals Inc (PCRX)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.33 | 0.39 | 0.33 | 0.25 | 0.37 |
| Debt-to-capital ratio | 0.37 | 0.46 | 0.48 | 0.34 | 0.46 |
| Debt-to-equity ratio | 0.59 | 0.85 | 0.92 | 0.51 | 0.86 |
| Financial leverage ratio | 1.81 | 2.17 | 2.84 | 2.06 | 2.34 |
Pacira BioSciences Inc's solvency ratios provide insights into the company's ability to meet its long-term obligations.
The debt-to-assets ratio has shown a decreasing trend over the past five years, indicating that Pacira's reliance on debt to fund its assets has been decreasing, which could be a positive indication of financial stability.
Similarly, the debt-to-capital and debt-to-equity ratios have also shown a decreasing trend over the same period. The decreasing debt-to-capital ratio indicates that the company is relying less on debt financing in relation to its total capital structure, which could reduce financial risk. The decreasing debt-to-equity ratio implies that the company's reliance on debt in relation to equity has been decreasing, which may signal improved financial health.
The financial leverage ratio, which measures the company's overall debt position relative to its equity, has also shown a decreasing trend. This indicates that Pacira is using less debt relative to its equity to finance its operations, which could enhance financial stability and reduce the risks associated with high debt levels.
Overall, based on these solvency ratios, Pacira BioSciences Inc appears to be gradually reducing its reliance on debt financing and improving its overall financial strength and stability over the past five years.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 4.04 | 1.33 | 2.78 | 1.78 | 0.55 |
Interest coverage is a financial ratio that indicates a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio is generally favorable as it suggests that the company has more than enough earnings to cover its interest obligations.
Pacira BioSciences Inc's interest coverage has fluctuated over the past five years. In 2023, the interest coverage ratio improved significantly to 10.11, indicating a strong ability to cover interest expenses with operating income. This increase from the previous year's ratio of 2.00 is a positive sign of improved financial health and reduced risk of default on debt obligations.
Furthermore, the interest coverage ratio in 2023 is notably higher compared to the ratios in 2021 (4.31), 2020 (2.45), and 2019 (2.20), indicating a marked improvement in the company's ability to meet its interest payments. This trend suggests that Pacira BioSciences Inc has managed its debt more effectively and/or generated higher operating income relative to its interest expenses.
Overall, the significant increase in Pacira BioSciences Inc's interest coverage ratio in 2023 demonstrates improved financial stability and decreased financial risk, which may be viewed positively by investors and creditors.