Premier Inc (PINC)
Solvency ratios
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.03 | 0.06 | 0.09 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.04 | 0.08 | 0.12 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.04 | 0.09 | 0.14 | 0.00 |
| Financial leverage ratio | 1.73 | 1.44 | 1.49 | 1.58 | 1.59 |
Premier Inc's solvency ratios indicate the company's ability to meet its long-term financial obligations. The debt-to-assets ratio has been consistently low, showing that the company has not been heavily reliant on debt to finance its assets in the past five years. This reflects a strong financial health in terms of its asset base.
The debt-to-capital ratio and debt-to-equity ratio have shown a slight increasing trend over the years, indicating that the company has been gradually increasing its reliance on debt to finance its operations. However, the ratios are still at manageable levels, suggesting that Premier Inc's capital structure is reasonably balanced between debt and equity.
The financial leverage ratio has fluctuated slightly over the years but has generally remained below 2. This ratio indicates the proportion of a company's debt to its equity and assets, showing that Premier Inc has been able to effectively utilize debt as part of its capital structure without excessive risk.
Overall, based on the solvency ratios analyzed, Premier Inc appears to have a healthy financial position with a well-managed debt structure and a solid ability to meet its long-term financial obligations.
Coverage ratios
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | — | 16.73 | 23.34 | 21.47 | 33.03 |
Premier Inc's interest coverage ratio has fluctuated over the past five years. In 2020, the company had a robust interest coverage ratio of 33.03, indicating a strong ability to meet its interest obligations using its operating income. However, this ratio decreased in subsequent years, reaching 21.47 in 2021 and 23.34 in 2022. These levels still demonstrate a healthy capacity to cover interest expenses. Notably, in 2023, Premier Inc experienced a significant drop in interest coverage to 16.73, which may raise concerns about the company's ability to comfortably meet its interest payments using its operating earnings. Further analysis and monitoring of Premier Inc's financial performance are warranted to assess the sustainability of its current interest coverage levels and ensure financial stability.