Penguin Solutions, Inc. (PENG)
Solvency ratios
| May 31, 2025 | Feb 28, 2025 | Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 3.08 | 3.01 | 3.95 | 3.77 | 3.65 | 3.75 | 3.98 | 6.77 | 5.00 | 5.03 | 5.13 | 4.23 | 3.96 | 4.32 | 4.10 | 4.33 | 4.41 | 3.17 | 2.82 | 2.79 |
The financial ratios concerning Penguin Solutions, Inc.'s solvency position reveal a notable pattern characterized by minimal leverage and substantial reliance on equity capital. Specifically, the debt-to-assets, debt-to-capital, and debt-to-equity ratios consistently report a value of zero across all observed dates, indicating an absence of third-party debt or borrowed funds during the periods analyzed. This pattern suggests that the company’s assets are financed entirely through equity, reflecting a debt-free capital structure over time.
In contrast, the financial leverage ratio exhibits considerable variation, underscoring changes in the company’s equity multiplier and overall leverage position. The ratio ranges from a low of approximately 2.79 in August 2020 to a high of about 6.77 in August 2023, before decreasing again towards the end of the observed period. These fluctuations imply variations in the amount of assets financed relative to equity, although they are not accompanied by changes in debt levels.
Overall, the data indicates that Penguin Solutions, Inc. maintains an extremely conservative or potentially zero-debt financial stance. The absence of debt ratios suggests no reliance on borrowed funds for asset financing, reflecting a strong solvency position characterized by high equity buffers and minimal to no leverage risk. The fluctuations in the leverage ratio are primarily driven by changes in asset levels or retained earnings rather than shifts in debt obligations.
Coverage ratios
| May 31, 2025 | Feb 28, 2025 | Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 1.85 | 1.89 | 0.52 | -0.10 | 0.51 | 0.11 | -0.19 | 0.17 | 0.72 | 2.10 | 3.76 | 5.18 | 5.92 | 4.29 | 4.13 | 3.16 | 2.48 | 3.13 | 2.03 | 1.62 |
The interest coverage ratio of Penguin Solutions, Inc. has experienced considerable fluctuations over the analyzed period, reflecting varying degrees of financial stability and ability to meet interest obligations.
From August 31, 2020, to November 30, 2021, the ratio exhibited a generally upward trend. It increased from 1.62 in August 2020 to a peak of 4.13 in November 2021. This indicates an improving capacity to cover interest expenses, with the ratio surpassing the critical threshold of 3, suggesting enhanced operational profitability or reduced debt levels during this interval.
Subsequently, the ratio continued to rise through February 2022, reaching 5.92, which signifies a strong cushion for interest payments, further emphasizing improved earnings relative to interest obligations.
However, starting from May 31, 2022, the ratio demonstrated a declining trend. It decreased from 5.92 to 3.76 by November 30, 2022, indicating a diminishing ability to cover interest expenses, although the ratio remained above 3, which is still generally considered acceptable.
The declines became more pronounced into 2023. On May 31, 2023, the ratio fell sharply to 0.72, and by August 31, 2023, it further dwindled to 0.17, approaching a critical level where earnings are barely sufficient to cover interest payments. The situation deteriorated further with the ratio turning negative at -0.19 on November 30, 2023, suggesting that the company's earnings before interest and taxes (EBIT) were insufficient to cover interest expenses, potentially indicating operational or financial distress.
The negative trend continued into early 2024, with the ratio modestly improving to 0.11 by February 29, 2024, and then rising to 0.51 by May 31, 2024. Despite this modest recovery, the interest coverage remained weak, indicating ongoing challenges in generating sufficient earnings to comfortably pay interest.
The data shows fluctuations thereafter, with the ratio reaching -0.10 on August 31, 2024, again signaling an inability to cover interest expenses with current earnings, but improving to 0.52 by November 30, 2024. The positive shift continued into 2025, with the ratio increasing to 1.89 on February 28, 2025, and slightly decreasing to 1.85 by May 31, 2025. While these figures remain below historical peaks, they reflect a partial recovery in the company's capacity to service interest obligations.
Overall, the interest coverage ratio of Penguin Solutions, Inc. demonstrates a pattern of initial improvement, reaching favorable levels in late 2021 and early 2022, followed by a marked decline beginning in mid-2022. The later data indicates persistent financial stress, with the company's ability to cover interest expenses weakening substantially into late 2023 and early 2024, although a gradual recovery is observable in the subsequent periods. This trend highlights periods of operational or financial challenges, underscoring the importance of ongoing financial management and strategic adjustments to restore profitability and stability.