Rollins Inc (ROL)

Rollins Inc's solvency ratios reflect the company's ability to meet its long-term financial obligations.

1. Debt-to-assets ratio: This ratio decreased from 0.10 in 2020 to 0.07 in 2021, indicating that the company's level of debt relative to its total assets declined. However, there was a slight increase in 2023 to 0.19 and then decreased to 0.14 in 2024, suggesting some fluctuation in managing its debt in relation to its assets.

2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio declined from 0.16 in 2020 to 0.11 in 2021 and further to 0.03 in 2022, showing a positive trend in reducing debt in relation to the overall capital structure. However, it spiked to 0.30 in 2023 and decreased slightly to 0.23 in 2024, indicating a sudden increase in debt compared to the capital.

3. Debt-to-equity ratio: The debt-to-equity ratio decreased from 0.19 in 2020 to 0.12 in 2021 and then significantly dropped to 0.03 in 2022, reflecting a lower level of debt relative to equity. However, there was a sharp increase in 2023 to 0.42 before decreasing to 0.30 in 2024, indicating potential risk due to higher levels of debt in relation to equity.

4. Financial leverage ratio: The financial leverage ratio decreased from 1.91 in 2020 to 1.82 in 2021 and further to 1.67 in 2022, showing an improving trend in utilizing debt to finance operations. However, it increased to 2.25 in 2023 and dropped to 2.12 in 2024, indicating an increased reliance on debt financing.

Overall, Rollins Inc has shown some fluctuations in its solvency ratios over the years, with periods of improvement followed by increases in indebtedness. It is important for the company to carefully manage its debt levels to maintain financial stability and ensure long-term viability.

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Coverage ratios

Rollins Inc's interest coverage ratio has shown a fluctuating trend over the past five years. As of December 31, 2020, the interest coverage ratio was at a healthy level of 74.00, indicating that the company was generating sufficient earnings to cover its interest expenses.

The ratio significantly improved by the end of December 31, 2021, surging to a high level of 539.32. This substantial increase suggests that Rollins Inc's earnings had grown significantly, providing a substantial buffer to cover its interest obligations.

However, in the following years, the interest coverage ratio decreased but remained above 1, indicating that the company was still able to meet its interest payments. By December 31, 2024, the interest coverage ratio had declined to 23.75, signaling a lower ability to cover interest expenses relative to the earlier years.

Overall, while the interest coverage ratio has fluctuated over the period, it has generally remained at levels above 1, indicating that Rollins Inc has had the ability to meet its interest obligations from its operating earnings. It is important for the company to monitor this ratio closely to ensure its financial health and ability to service its debt obligations.