Rockwell Automation Inc (ROK)
Solvency ratios
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.23 | 0.25 | 0.27 | 0.32 | 0.27 |
| Debt-to-capital ratio | 0.42 | 0.45 | 0.51 | 0.59 | 0.66 |
| Debt-to-equity ratio | 0.73 | 0.80 | 1.05 | 1.45 | 1.92 |
| Financial leverage ratio | 3.21 | 3.17 | 3.95 | 4.48 | 7.07 |
Rockwell Automation Inc's solvency ratios indicate the company's ability to meet its financial obligations and leverage its assets.
1. Debt-to-assets ratio: The trend shows a slight decrease over the years, from 0.32 in 2021 to 0.23 in 2024. This implies that the company's proportion of assets financed by debt has been reducing, which is a positive indicator of financial strength.
2. Debt-to-capital ratio: Similarly, there is a decreasing trend from 0.66 in 2020 to 0.42 in 2024. This ratio indicates the extent to which the company relies on debt to finance its operations, and the decreasing trend suggests an improved ability to fund operations through equity.
3. Debt-to-equity ratio: The trend for this ratio shows a significant improvement, decreasing from 1.92 in 2020 to 0.73 in 2024. This signifies that the company is relying less on debt in relation to equity, which is a positive sign of financial stability and lower financial risk.
4. Financial leverage ratio: The trend for the financial leverage ratio fluctuates but shows a general downward trend from 7.07 in 2020 to 3.21 in 2024. This indicates that the company has been reducing its reliance on debt to finance its assets over the years, which is favorable for long-term financial health.
Overall, the analysis of Rockwell Automation Inc's solvency ratios suggests a positive trend towards lower reliance on debt for financing, improved financial stability, and a stronger balance sheet position over the years.
Coverage ratios
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 3.21 | 13.70 | 9.82 | 17.28 | 11.98 |
Interest coverage is a financial ratio that indicates a company's ability to pay interest expenses on its outstanding debt. A higher interest coverage ratio implies a stronger ability to meet interest obligations.
Analyzing the interest coverage ratio of Rockwell Automation Inc over the past five years, we observe fluctuations in the company's ability to cover its interest payments.
In September 2024, the interest coverage ratio decreased to 3.21 from the previous year, indicating a reduction in the company's ability to cover its interest expenses using its operating profits. This decline may raise concerns about the company's financial health and its ability to service its debt.
In comparison, the interest coverage ratio was significantly higher in September 2023, at 13.70, indicating a robust ability to cover interest expenses. This was a positive sign for the company.
Similarly, in September 2022 and 2021, the interest coverage ratios were 9.82 and 17.28, respectively, showing strong ability to cover interest payments in those years.
In September 2020, the interest coverage ratio was 11.98, indicating a healthy position in terms of covering interest expenses.
It is essential for investors and creditors to closely monitor the fluctuations in the interest coverage ratio of Rockwell Automation Inc to assess the company's financial stability and ability to service its debt obligations in the future.