Rockwell Automation Inc (ROK)
Solvency ratios
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.25 | 0.27 | 0.32 | 0.27 | 0.32 |
| Debt-to-capital ratio | 0.45 | 0.51 | 0.59 | 0.66 | 0.83 |
| Debt-to-equity ratio | 0.80 | 1.05 | 1.45 | 1.92 | 4.84 |
| Financial leverage ratio | 3.17 | 3.95 | 4.48 | 7.07 | 15.12 |
The solvency ratios of Rockwell Automation Inc indicate positive trends in its debt management over the past five years. The debt-to-assets ratio has decreased consistently, reaching 0.26 in 2023 from 0.37 in 2019, suggesting improved asset coverage of the company's debt. Similarly, the debt-to-capital ratio has also shown a declining trend, dropping to 0.45 in 2023 from 0.85 in 2019, indicating a reduction in the proportion of debt in the company's capital structure.
The debt-to-equity ratio has significantly improved, declining from 5.58 in 2019 to 0.83 in 2023. This indicates a substantial decrease in the company's reliance on debt financing in relation to equity, reflecting a stronger financial position and reduced financial risk. Additionally, the financial leverage ratio has exhibited a declining trend, signaling a lower dependence on debt to finance the company's assets.
Overall, the solvency ratios of Rockwell Automation Inc demonstrate a positive shift towards a more conservative and sustainable capital structure, with reduced reliance on debt financing and improved financial leverage, indicating improved solvency and financial stability.
Coverage ratios
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 13.70 | 9.82 | 17.28 | 11.98 | 10.18 |
The interest coverage ratio measures a company's ability to meet its interest obligations on outstanding debt. Rockwell Automation Inc's interest coverage has been relatively stable over the past five years, with values ranging from 11.24 to 15.63. The current ratio of 13.48 as of September 30, 2023, indicates that the company's operating income is 13.48 times greater than its annual interest expense. This suggests that Rockwell Automation Inc has a strong ability to cover its interest payments from its operating earnings, which is a positive indicator of financial stability. However, it is important to consider the trend over time and compare this ratio with industry benchmarks to gain a comprehensive understanding of the company's financial health.