Sun Country Airlines Holdings Inc (SNCY)

Based on the provided data, we can observe the following trends in Sun Country Airlines Holdings Inc.'s solvency ratios:

1. Debt-to-assets ratio: This ratio measures the proportion of assets financed by debt. Sun Country Airlines' debt-to-assets ratio has been relatively stable over the years, increasing from 0.18 in 2021 to 0.20 in 2023 before decreasing to 0.15 in 2024. This indicates that the company has maintained a conservative level of debt to fund its assets.

2. Debt-to-capital ratio: This ratio indicates the proportion of capital that is financed by debt. Sun Country Airlines' debt-to-capital ratio has shown an increasing trend over the years, rising from 0.34 in 2021 to 0.39 in 2023 before decreasing to 0.30 in 2024. This suggests that the company has been relying more on debt to fund its operations and investments.

3. Debt-to-equity ratio: This ratio shows the amount of debt used to finance the company relative to shareholders' equity. Sun Country Airlines' debt-to-equity ratio has fluctuated over the years, increasing from 0.51 in 2021 to 0.64 in 2023 before decreasing to 0.42 in 2024. The rising trend indicates that the company has been increasing its debt levels compared to equity.

4. Financial leverage ratio: This ratio measures the company's ability to meet its financial obligations using debt. Sun Country Airlines' financial leverage ratio has also fluctuated, reaching a peak of 3.16 in 2023 before decreasing to 2.86 in 2024. This suggests that the company has been managing its financial leverage effectively, although it still remains relatively high.

Overall, Sun Country Airlines' solvency ratios indicate a mix of conservative debt management and reliance on debt financing to support its operations and growth, with some fluctuations in the ratios over the years. It is important for investors and stakeholders to monitor these ratios to assess the company's financial health and risk levels.

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Coverage ratios

The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. Sun Country Airlines Holdings Inc's interest coverage ratio has experienced fluctuations over the past four years.

In December 2021, the interest coverage ratio of Sun Country Airlines Holdings Inc was 4.81, indicating that the company generated operating income sufficient to cover its interest expenses nearly five times over. However, by December 2022, the interest coverage ratio decreased significantly to 1.77, suggesting a decline in the company's ability to service its interest payments with its operating income.

The company's interest coverage ratio improved in December 2023 to 3.21, indicating a partial recovery in its ability to cover interest expenses. The most notable increase in the interest coverage ratio occurred by December 2024, reaching 20.97, reflecting a substantial improvement and a strong ability to meet interest obligations with operating income.

Overall, it is essential for Sun Country Airlines Holdings Inc to monitor its interest coverage ratio closely, as it provides insights into the company's financial health and ability to manage its debt obligations. Fluctuations in the interest coverage ratio may indicate changes in the company's financial performance and its capacity to handle debt effectively.