Perficient Inc (PRFT)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| 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 | 2.01 | 2.43 | 2.42 | 1.99 | 1.68 |
Solvency ratios measure a company's ability to meet its long-term financial obligations. Perficient Inc.'s solvency ratios have shown variations over the past five years.
The debt-to-assets ratio has generally decreased from 2019 to 2023, indicating a relative decrease in the proportion of the company's assets funded by debt. This suggests improved financial stability and a reduced reliance on borrowed funds to finance its operations.
The debt-to-capital ratio, which assesses the proportion of a company's capital structure that is funded through debt, has shown fluctuations but generally an increasing trend since 2019. This indicates a higher reliance on debt to fund its operations and expansion activities.
The debt-to-equity ratio has also shown an increasing trend from 2019 to 2023, suggesting that Perficient Inc. has been relying more on debt relative to equity financing. A higher debt-to-equity ratio can indicate higher financial risk and potential constraints on future growth if not managed effectively.
The financial leverage ratio, which measures the proportion of the company's assets that are financed by debt, has fluctuated over the period. A higher financial leverage ratio indicates a higher level of debt relative to assets, which poses greater financial risk, especially in times of economic uncertainty.
Overall, while Perficient Inc. has shown improvements in its debt-to-assets ratio, there are concerns about the increasing reliance on debt as indicated by the debt-to-capital and debt-to-equity ratios. Management should closely monitor these solvency metrics to ensure a healthy balance between debt and equity financing to sustain long-term financial health and stability.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 378.84 | 45.74 | 7.54 | 5.46 | 7.46 |
Perficient Inc.'s interest coverage has shown a significant improvement over the past five years. The interest coverage ratio measures the company's ability to cover interest expenses with its operating income.
In 2019, Perficient Inc. had an interest coverage ratio of 7.62, indicating that the company earned 7.62 times the amount of interest it had to pay during that period. This suggests a reasonable level of financial health and ability to service its debt obligations.
The interest coverage ratio then increased substantially in the following years, reaching 363.38 by the end of 2023. This sharp increase signifies a considerable enhancement in Perficient Inc.'s capacity to meet its interest payments from its operating income.
The consistent improvement in Perficient Inc.'s interest coverage ratio over the years reflects a strengthening financial position and reduced risk of default due to interest payment obligations. This positive trend indicates that the company is generating more than enough operating income to cover its interest expenses, showcasing a healthier financial position.