SPX Corp (SPXC)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 2.04 | 1.79 | 2.38 | 3.65 | 4.24 |
Solvency ratios provide insight into a company's ability to meet its long-term financial obligations. In the case of SPX Corp, the debt-to-assets, debt-to-capital, and debt-to-equity ratios have consistently been reported as 0.00 over the past five years. This indicates that the company has not used debt financing to support its operations or investments during this period.
However, the financial leverage ratio for SPX Corp has shown some fluctuations over the past five years. The ratio was 2.04 in 2023, compared to 1.79 in 2022, 2.38 in 2021, 3.65 in 2020, and 4.24 in 2019. The increasing trend from 2019 to 2021, followed by a slight decrease in 2022 and a further decrease in 2023, suggests a potential improvement in the company's financial leverage position.
Overall, SPX Corp's solvency ratios indicate a conservative approach to capital structure with minimal reliance on debt financing, as seen from the consistently low debt-related ratios. Additionally, the decreasing trend in the financial leverage ratio suggests a potential improvement in the company's financial risk profile and ability to manage its debt levels.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 5.83 | 1.81 | 34.31 | 6.64 | 4.70 |
SPX Corp's interest coverage ratio has exhibited fluctuations over the past five years. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt, with higher values indicating a lower financial risk.
In 2023, the interest coverage ratio improved significantly to 5.83 from 1.81 in 2022, indicating that the company's ability to cover its interest expenses strengthened. This improvement suggests that SPX Corp's earnings are more than sufficient to cover its interest obligations, reflecting better financial health.
The sharp decline in the interest coverage ratio in 2022 might have raised concerns as it dropped to 1.81, signaling a lower ability to meet interest payments from operating profits. However, this was followed by a substantial increase in 2023, indicating possible corrective actions taken by the company to enhance its financial position.
The exceptionally high interest coverage ratio of 34.31 in 2021 reflects a strong ability to meet interest obligations, indicating a robust financial position. This could be attributed to higher earnings compared to interest expenses, signifying a low risk of default on debt repayment.
Overall, SPX Corp's interest coverage ratio has shown variability over the years, with fluctuations indicating changing financial performance and risk levels. The company's management may need to monitor and manage its interest coverage ratio effectively to ensure sustainable financial stability and debt repayment capacity.