RadNet Inc (RDNT)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.30 | 0.34 | 0.36 | 0.34 | 0.40 |
| Debt-to-capital ratio | 0.56 | 0.72 | 0.76 | 0.79 | 0.81 |
| Debt-to-equity ratio | 1.29 | 2.52 | 3.25 | 3.70 | 4.30 |
| Financial leverage ratio | 4.27 | 7.31 | 8.99 | 10.78 | 10.86 |
Based on the solvency ratios of Radnet Inc over the past five years, there are some notable trends to consider.
1. Debt-to-assets ratio: This ratio measures the proportion of a company's assets funded by debt. Radnet Inc's debt-to-assets ratio has decreased from 0.42 in 2019 to 0.31 in 2023, indicating an improvement in the company's ability to finance its assets with debt.
2. Debt-to-capital ratio: This ratio reflects the percentage of a company's capital that is financed by debt. Radnet Inc's debt-to-capital ratio has shown a declining trend from 0.82 in 2019 to 0.57 in 2023, suggesting a lower reliance on debt for funding the company's operations.
3. Debt-to-equity ratio: This ratio compares a company's total debt to its shareholders' equity. Radnet Inc's debt-to-equity ratio has decreased significantly from 4.61 in 2019 to 1.32 in 2023, demonstrating a decreasing financial risk and a stronger equity position in the capital structure.
4. Financial leverage ratio: This ratio indicates the extent to which a company uses debt to finance its operations. Radnet Inc's financial leverage ratio has decreased from 10.86 in 2019 to 4.27 in 2023, highlighting a reduction in the company's reliance on debt financing.
Overall, Radnet Inc has shown positive progress in improving its solvency ratios over the past five years, reflecting a stronger financial position and reduced financial risk. The declining trend in these ratios indicates that the company has been effective in managing its debt levels and strengthening its capital structure.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 1.53 | 0.91 | 1.69 | 0.77 | 1.44 |
The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. A higher ratio indicates a greater ability to cover interest expenses with operating income.
Over the past five years, Radnet Inc's interest coverage ratio has varied significantly. In 2023, the interest coverage ratio improved to 1.54 from 1.18 in 2022, showing a better ability to cover interest payments. However, it is still relatively low, suggesting that Radnet Inc may have limited earnings available to meet its interest obligations.
In 2021, the interest coverage ratio was relatively high at 2.17, indicating a strong ability to pay interest from operating income. This was a positive trend compared to 2020, when the ratio was only 0.59, signaling a potential strain on the company's financial resources to cover interest expenses.
In 2019, Radnet Inc's interest coverage ratio improved to 1.71, indicating a stronger ability to meet interest payments compared to 2020. Overall, while Radnet Inc has shown fluctuations in its interest coverage ratio over the past five years, maintaining a consistent and higher interest coverage ratio in the future would be essential to ensure the company's financial stability.