Performance Food Group Co (PFGC)

Performance Food Group Co's solvency ratios have shown some fluctuations over the past five years. Looking at the Debt-to-assets ratio, it has decreased from 0.32 in 2022 to 0.28 in 2023, indicating that the company has reduced its reliance on debt to finance its assets. This trend suggests an improvement in the company's ability to meet its long-term obligations using its assets.

The Debt-to-capital ratio also shows a decreasing trend, from 0.54 in 2022 to 0.48 in 2023. This indicates that Performance Food Group Co has been able to lower its debt level relative to its total capital, which includes both debt and equity. A lower Debt-to-capital ratio is generally seen as a positive sign of financial health.

The Debt-to-equity ratio has fluctuated over the period, with a significant decrease from 1.18 in 2022 to 0.92 in 2023. A lower Debt-to-equity ratio suggests that the company is relying less on debt and is financing a larger portion of its operations through equity. This can be considered favorable, as it indicates a lower financial risk for the company.

The Financial leverage ratio has also shown some variability, decreasing from 3.75 in 2022 to 3.34 in 2023. This ratio measures the company's ability to meet its financial obligations using its assets. A declining trend in this ratio indicates that Performance Food Group Co is using less debt to finance its operations, which can lead to lower financial risk and greater stability.

Overall, the downward trend in all solvency ratios suggests that Performance Food Group Co has been improving its financial leverage and reducing its reliance on debt for financing its operations, which can contribute to a strengthened financial position and enhanced solvency.

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Coverage ratios

The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio indicates a stronger ability to meet interest obligations.

Performance Food Group Co's interest coverage has shown some fluctuation over the past five years. In 2023, the interest coverage ratio improved to 3.50, indicating that the company generated 3.50 times more operating income than its interest expenses. This is a positive sign as it shows an increase in the company's ability to cover its interest payments compared to the previous year.

In 2022, the interest coverage ratio was 1.91, indicating that the company generated enough operating income to cover its interest expenses 1.91 times. Although still above 1, this ratio suggests a relatively lower ability to cover interest payments compared to the most recent year.

In 2021, the interest coverage ratio was 1.36, signaling a slight decline in the company's ability to cover interest expenses compared to the previous year. In 2020, the interest coverage ratio was negative at -0.90, indicating that the company's operating income was insufficient to cover its interest expenses, which is a concerning trend.

Finally, in 2019, the interest coverage ratio was 4.34, showing a strong ability to cover interest expenses with operating income. Overall, the trend in interest coverage shows some volatility, with improvements in recent years, but with a significant decline in 2020. It will be essential for Performance Food Group Co to continue monitoring and improving its interest coverage to ensure financial stability and sustainability.