Shutterstock (SSTK)

Based on the provided data, Shutterstock has consistently maintained a low level of indebtedness in terms of its solvency ratios. The debt-to-assets ratio for the years 2020 to 2023 indicates that the company had no debt in relation to its total assets during these years. However, there was a slight increase in the debt-to-assets ratio in 2024, amounting to 0.09, indicating a minimal level of debt compared to the company's total assets.

Similarly, the debt-to-capital ratio for the years 2020 to 2023 remained at 0.00, suggesting that Shutterstock did not rely on debt to finance its capital structure. However, this ratio increased to 0.19 in 2024, indicating that a small portion of the company's capital was financed through debt in that year.

The debt-to-equity ratio for the years 2020 to 2023 also remained at 0.00, reflecting a balanced proportion of debt and equity in the company's capital structure. In 2024, there was an increase in the debt-to-equity ratio to 0.23, suggesting a higher reliance on debt financing compared to equity.

Furthermore, the financial leverage ratio for Shutterstock increased from 1.73 in 2020 to 2.53 in 2024, indicating a rise in the company's financial leverage over the years. This implies that Shutterstock has been taking on more debt relative to its equity, leading to increased financial risk and potential profitability.

Overall, while Shutterstock has historically maintained a low level of debt in relation to its assets, capital, and equity, the increasing trend in the financial leverage ratio suggests a shift towards a slightly higher reliance on debt financing by the company in recent years.

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Coverage ratios

The interest coverage ratio measures a company's ability to meet its interest obligations on outstanding debt. A higher interest coverage ratio indicates a stronger ability to cover interest expenses.

Looking at the data provided for Shutterstock's interest coverage ratio over the years:

1. In December 31, 2020, the interest coverage ratio was 11.64, indicating that the company's operating income was 11.64 times higher than its interest expenses.

2. In December 31, 2021, there was a significant increase in the interest coverage ratio to 1,613.52, suggesting a substantial improvement in the company's ability to cover its interest payments.

3. By December 31, 2022, the interest coverage ratio decreased to 70.08, still reflecting a strong ability to service its debt obligations.

4. In December 31, 2023, the interest coverage ratio declined further to 36.85, indicating a potential decrease in the company's ability to cover interest expenses compared to the previous year.

5. Lastly, by December 31, 2024, the interest coverage ratio dropped to 6.51, signaling a continued decrease in the company's ability to cover interest payments.

Overall, the trend in Shutterstock's interest coverage ratio fluctuated over the years, with significant improvements followed by declines. It is important for investors and creditors to monitor this ratio to assess the company's financial health and its ability to meet its debt obligations.