Rollins Inc (ROL)

The solvency ratios of Rollins, Inc. provide valuable insights into the company's financial health and ability to meet its long-term obligations. The debt-to-assets ratio has shown an increasing trend from 0.03 in 2019 to 0.19 in 2023, indicating a higher proportion of assets financed by debt over the years.

Similarly, the debt-to-capital and debt-to-equity ratios have also displayed an upward trajectory, implying that the company has been relying more on debt to finance its operations and investments relative to its capital and equity. This trend may raise concerns about the company's financial risk and leverage levels.

The financial leverage ratio, which measures the proportion of assets financed by debt relative to equity, has fluctuated within a narrow range between 1.67 and 2.25 over the past five years. A higher financial leverage ratio indicates a greater reliance on debt financing, which can amplify returns but also increase financial risk.

Overall, the increasing trend in the debt ratios and relatively stable financial leverage ratio suggest that Rollins, Inc. has been gradually taking on more debt to support its growth and operations. Investors and stakeholders should closely monitor these solvency ratios to assess the company's ability to manage its debt levels and uphold financial stability in the long term.

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Coverage ratios

Interest coverage is a financial ratio that measures a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.

Looking at the trend for Rollins, Inc. over the past five years, the interest coverage ratio has displayed significant fluctuations. In 2021, the interest coverage ratio was notably high at 530.11, indicating a robust ability to pay interest expenses from operating income. This could be a positive sign of financial strength and stability.

In contrast, the interest coverage ratio dropped in 2020 to 72.43 before increasing to 187.03 in 2022 and further to 30.88 in 2023. While the ratio in 2023 is still relatively high, the decrease from the previous year may raise some concerns about the company's ability to cover its interest expenses comfortably.

The fluctuation in the interest coverage ratio for Rollins, Inc. suggests some variability in the company's earnings and ability to service its debt. Further analysis of the underlying factors affecting the operating income and interest expenses may provide insights into the company's financial health and sustainability in meeting its financial obligations.