Simply Good Foods Co (SMPL)

The solvency ratios of Simply Good Foods Co indicate the company's ability to meet its long-term obligations and the extent to which it relies on debt to finance its operations. The debt-to-assets ratio has shown a consistent and favorable trend, decreasing from 0.30 in 2020 to 0.13 in 2023, indicating an improvement in the company's ability to cover its liabilities with assets. Similarly, the debt-to-capital and debt-to-equity ratios have also displayed a decreasing trend over the same period, reflecting a reduction in the company's reliance on debt for capital and shareholder equity, respectively.

Furthermore, the financial leverage ratio has exhibited a fluctuating pattern, but overall has shown a downward trend, suggesting a decrease in the company's reliance on debt financing to generate earnings. This indicates an improvement in the company's financial risk and a strengthening of its overall solvency position.

Overall, the solvency ratios of Simply Good Foods Co reflect a positive trend, indicating the company's strengthening financial position and reduced reliance on debt for its capital structure, which is generally favorable for its long-term financial health and stability.

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Coverage ratios

The interest coverage ratio of Simply Good Foods Co has demonstrated fluctuations over the past five years. In Aug 26, 2023, the interest coverage ratio was 7.09, representing a decrease from the previous year's ratio of 9.27. This decline may indicate a decrease in the company's ability to meet its interest payment obligations. However, it is important to note that the ratio remains above 1, suggesting that the company is still generating enough operating income to cover its interest expenses. The trend over the five-year period indicates some variability in the company's ability to cover interest payments, highlighting the need for further examination of the company's financial leverage and operating performance.