Skyline Corporation (SKY)

Based on the provided data for Skyline Corporation's solvency ratios, we can observe the following trends:

1. Debt-to-assets ratio: This ratio measures the proportion of the company's assets financed by debt. Skyline Corporation has consistently maintained a debt-to-assets ratio of 0.00 over the past five years, indicating that the company has not used debt to finance its assets during this period. This suggests a low level of financial risk related to debt obligations.

2. Debt-to-capital ratio: The debt-to-capital ratio indicates the percentage of the company's capital that is funded by debt. Similar to the debt-to-assets ratio, Skyline Corporation has maintained a debt-to-capital ratio of 0.00, showing that the company has not relied on debt to fund its capital structure. This also indicates a conservative financial approach with minimal reliance on debt financing.

3. Debt-to-equity ratio: The debt-to-equity ratio reflects the proportion of the company's financing that comes from debt compared to equity. Skyline Corporation's debt-to-equity ratio has been consistently at 0.00, indicating that the company's financial structure is predominantly equity-financed. This implies that shareholders have a higher stake in the company compared to creditors.

4. Financial leverage ratio: The financial leverage ratio measures the extent to which the company's operations are funded by debt. Skyline Corporation's financial leverage ratio has decreased from 1.61 in 2021 to 1.35 in 2024. This decline indicates a reduced reliance on debt over the years, leading to a stronger equity base and potentially lower financial risk.

In summary, the solvency ratios for Skyline Corporation demonstrate a strong financial position with minimal debt utilization and a conservative capital structure. The downward trend in the financial leverage ratio further suggests a balanced approach to financing operations, which may contribute to the company's overall stability and resilience to economic challenges.

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Coverage ratios

Skyline Corporation's interest coverage ratio has shown fluctuations over the years based on the provided data. In March 2021, the interest coverage ratio was 33.48, indicating that the company's operating income was sufficient to cover its interest expenses 33.48 times. The ratio increased significantly to 132.53 in March 2022 and further rose to 158.21 in March 2023, suggesting a strong ability to meet interest obligations.

However, there was a notable decline in the interest coverage ratio to 37.98 in March 2024, indicating a potential decrease in the company's ability to cover interest expenses. Surprisingly, in March 2025, the interest coverage ratio dropped to 0.00, which raises concerns about the company's ability to generate enough operating income to cover its interest payments.

Overall, the trend in interest coverage ratios for Skyline Corporation shows variability, with periods of strong coverage followed by a significant decline. It is essential for the company to monitor and manage its interest expenses closely to ensure sustainable financial health and stability.