Insulet Corporation (PODD)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.61 | 0.61 | 0.56 | 0.78 |
| Debt-to-capital ratio | 0.00 | 0.74 | 0.69 | 0.63 | 0.92 |
| Debt-to-equity ratio | 0.00 | 2.88 | 2.24 | 1.73 | 11.70 |
| Financial leverage ratio | 3.53 | 4.73 | 3.68 | 3.10 | 15.06 |
Insulet Corporation's solvency ratios provide insights into its financial health and ability to meet its long-term obligations. The trends in the ratios over the past five years indicate the company's changing leverage and debt structure.
The debt-to-assets ratio, which measures the proportion of total assets financed by debt, decreased from 0.78 in 2019 to 0.55 in 2023, suggesting a more conservative approach to debt utilization and improved asset coverage of liabilities.
The debt-to-capital ratio, representing the proportion of total capital comprised of debt, decreased from 0.92 in 2019 to 0.66 in 2023. This indicates a decreasing reliance on debt in the capital structure and a shift towards a more balanced mix of equity and debt financing.
The debt-to-equity ratio, revealing the extent to which debt funds the company, fluctuated over the years but showed a significant decrease from 11.70 in 2019 to 1.93 in 2023. This indicates a reduction in financial risk and a higher reliance on equity financing compared to debt.
The financial leverage ratio, which evaluates the company's debt level in relation to its equity, decreased from 15.06 in 2019 to 3.53 in 2023. This indicates a lower level of financial risk and a stronger equity position to support the company's operations.
Overall, the declining trend in Insulet Corporation's solvency ratios suggests an improved financial position, lower leverage, and better long-term debt management, which may enhance the company's stability and ability to meet its financial obligations in the future.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 6.93 | 1.29 | 1.33 | 1.20 | 1.42 |
The interest coverage ratio is a measure of a company's ability to meet its interest payments on outstanding debt. It indicates the company's ability to generate enough operating income to cover its interest expenses. A higher interest coverage ratio is generally considered favorable as it suggests a stronger ability to meet interest obligations.
Analyzing Insulet Corporation's interest coverage ratio over the past five years, we observe a significant improvement from 2019 to 2023. In 2019, the interest coverage ratio was 1.45, indicating that the company generated just enough operating income to cover its interest payments. However, the ratio saw a substantial increase to 28.95 in 2023, reflecting a much stronger ability to cover interest expenses with operating income.
The drastic improvement in Insulet Corporation's interest coverage ratio suggests a significant enhancement in the company's financial health and ability to service its debt obligations. This could be attributed to increased profitability, operational efficiency, or prudent management of debt levels. The substantial increase in the interest coverage ratio over the years indicates a positive trend and enhances investor confidence in the company's financial stability.