PDF Solutions Inc (PDFS)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 1.28 | 1.27 | 1.33 | 1.25 | 1.23 |
PDF Solutions Inc has consistently shown strong solvency ratios over the past five years. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio have all remained at 0.00, indicating that the company carries no debt relative to its total assets, capital, or equity. This suggests that PDF Solutions has no financial risk stemming from debt obligations.
Furthermore, the financial leverage ratio has been relatively stable, ranging from 1.23 to 1.33 over the same period. A financial leverage ratio below 1 indicates that the company has more equity than debt in its capital structure, which is a positive sign for investors and creditors. An increasing trend in the financial leverage ratio could be indicative of higher financial risk, but the minor fluctuations in PDF Solutions' ratio suggest a consistent and balanced capital structure.
Overall, PDF Solutions Inc's solvency ratios reflect a financially strong and stable position, with no significant leverage or debt burden. Investors and stakeholders can be confident in the company's ability to meet its financial obligations in the long term.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 0.17 | -0.03 | -0.82 | -23.16 | -14.23 |
The interest coverage ratio is a key financial metric that indicates a company's ability to meet its interest obligations using its operating income. A higher interest coverage ratio is generally preferred as it signifies a healthier financial position.
Analyzing PDF Solutions Inc's interest coverage ratio over the years reveals a concerning trend. In December 2020, the interest coverage ratio was -14.23, indicating that the company's operating income was insufficient to cover its interest expenses, raising solvency risks.
The situation worsened in December 2021, with the interest coverage ratio plummeting to -23.16, indicating a deteriorating financial condition. The company's ability to meet its interest obligations further deteriorated in December 2022 and December 2023, with ratios of -0.82 and -0.03, respectively, suggesting significant financial stress and potential insolvency risks.
However, there seems to be a slight improvement in December 2024, with an interest coverage ratio of 0.17. While still below ideal levels, this improvement may indicate some progress in the company's financial management and operational performance.
Overall, PDF Solutions Inc's interest coverage ratios paint a concerning picture of the company's financial health, with a consistent inability to cover interest expenses with operating income. Investors and stakeholders should closely monitor the company's financial management and performance to assess its ability to address these challenges and improve its financial stability.