Solventum Corp. (SOLV)
Solvency ratios
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | ||||
|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — |
| Financial leverage ratio | 3.82 | 4.22 | 4.27 | 3.61 | 1.16 | 1.16 | — | — |
Solventum Corp. shows consistent and strong solvency ratios over the past five quarters. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio are all consistently at 0.00, indicating that the company does not rely heavily on debt to finance its assets or capital structure. This suggests a low level of financial risk and a strong financial position.
However, the financial leverage ratio has varied significantly over the period, ranging from 1.16 to 4.27. This ratio measures the extent to which the company is using debt to finance its operations, with higher ratios indicating higher leverage. The most recent value of 3.82 indicates that the company is using debt in its capital structure, but to a moderate extent.
Overall, Solventum Corp. appears to have a conservative approach to managing its debt and maintains a solid solvency position. The fluctuations in the financial leverage ratio may be attributed to changes in the company's financial strategy or investment decisions. Investors and stakeholders can take comfort in the company's overall strong solvency ratios.
Coverage ratios
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | |
|---|---|---|---|---|---|
| Interest coverage | 39.37 | — | — | — | — |
As of March 31, 2024, Solventum Corp. has an interest coverage ratio of 39.37. This indicates that the company is generating significant operating income relative to its interest expenses, providing a strong cushion to cover its interest payments. A high interest coverage ratio is generally considered favorable, as it suggests that the company is in a good position to meet its debt obligations and is less likely to default on its loans. It also signifies that the company has a lower risk of financial distress due to its ability to comfortably handle its interest payments. However, it's important to note that without historical data for comparison, it is difficult to assess the trend and stability of Solventum Corp.'s interest coverage over time.