SkyWest Inc (SKYW)

Solvency ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Debt-to-assets ratio	0.36	0.37	0.39	0.39	0.40	0.40	0.39	0.39	0.38	0.38	0.38	0.40	0.41	0.40	0.39	0.38	0.39	0.40	0.41	0.42
Debt-to-capital ratio	0.55	0.55	0.56	0.56	0.56	0.55	0.55	0.55	0.55	0.54	0.54	0.56	0.57	0.55	0.55	0.54	0.55	0.55	0.57	0.58
Debt-to-equity ratio	1.21	1.23	1.27	1.28	1.25	1.24	1.22	1.22	1.20	1.15	1.18	1.26	1.31	1.24	1.24	1.17	1.21	1.24	1.32	1.37
Financial leverage ratio	3.32	3.30	3.30	3.24	3.16	3.11	3.13	3.12	3.14	3.07	3.11	3.16	3.22	3.09	3.16	3.08	3.06	3.12	3.21	3.27

Based on the solvency ratios of Skywest Inc. over the past eight quarters, we observe the following trends:

1. Debt-to-assets ratio: The ratio has fluctuated within a relatively narrow range between 0.43 and 0.46 over the periods analyzed. This indicates that, on average, between 43% to 46% of the company's assets are financed by debt.

2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio has shown stability, moving between 0.58 and 0.60. This implies that debt constitutes approximately 58% to 60% of the company's total capital structure.

3. Debt-to-equity ratio: The trend line for the debt-to-equity ratio has been relatively consistent, ranging from 1.40 to 1.48. This suggests that, on average, the company has been relying heavily on debt financing, with debt representing around 140% to 148% of its shareholders' equity.

4. Financial leverage ratio: The financial leverage ratio has shown an upward trend from 3.11 in Q3 2022 to 3.32 in Q4 2023. This indicates an increase in the company's reliance on debt to finance its operations and investments over the analyzed periods.

Overall, the solvency ratios of Skywest Inc. demonstrate a consistent reliance on debt financing to support its operations and growth. The company appears to maintain a stable level of debt relative to its assets and capital structure, with a gradually increasing financial leverage ratio indicating a growing dependence on debt to fund its activities. This analysis highlights the ongoing importance of monitoring the company's debt levels and overall solvency position to assess its financial health and risk profile.

Coverage ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Interest coverage	0.79	0.31	0.50	0.94	1.43	2.06	1.89	2.05	2.24	1.71	1.91	0.99	0.88	2.14	2.70	3.84	4.01	3.63	3.49	3.55

The interest coverage ratio measures a company's ability to meet its interest obligations through its operating income. A higher ratio indicates a stronger ability to cover interest expenses.

Looking at the data for Skywest Inc., we observe fluctuations in the interest coverage ratio over the quarters. In Q4 2022, the ratio was relatively high at 1.65, indicating that the company's operating income was 1.65 times its interest expenses for that period.

However, the interest coverage ratio decreased in subsequent quarters, reaching its lowest point of 0.44 in Q3 2023. This indicates that in Q3 2023, the company's operating income was barely sufficient to cover its interest expenses, suggesting a potential strain on its financial resources.

While there was a slight improvement in Q4 2023 with an interest coverage ratio of 1.20, it is still below the levels seen in earlier quarters. This trend may raise concerns about Skywest Inc.'s ability to comfortably meet its interest obligations in the future, particularly if profitability does not improve.

Overall, the fluctuating interest coverage ratios of Skywest Inc. suggest the need for closer monitoring of the company's financial performance and potential risks associated with its interest-bearing liabilities.