Steel Dynamics Inc (STLD)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| 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 | 1.67 | 1.68 | 1.74 | 1.99 | 2.13 |
Steel Dynamics Inc has consistently shown a strong solvency position, as reflected in its solvency ratios. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio have all remained at 0.00 from 2020 to 2024, indicating that the company has no significant debt relative to its assets, capital, or equity.
Furthermore, the financial leverage ratio has decreased steadily from 2.13 in 2020 to 1.67 in 2024. This reduction indicates that the company has been relying less on debt to finance its operations over the years, which is a positive sign for its long-term financial stability.
Overall, Steel Dynamics Inc's solvency ratios suggest a robust financial position with minimal debt exposure and a decreasing reliance on leverage for its capital structure, which bodes well for its ability to weather economic challenges and sustain growth in the long run.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 36.19 | 41.20 | 55.85 | 74.57 | 9.13 |
Steel Dynamics Inc's interest coverage ratio has shown a positive trend over the analyzed period, indicating the company's strong ability to cover its interest payments from operating income. In December 2020, the interest coverage ratio stood at 9.13, suggesting that the company's operating income was able to cover its interest expenses approximately nine times.
Significantly, by December 2021, the interest coverage ratio improved notably to 74.57, demonstrating a substantial increase in the company's ability to meet its interest obligations. This sharp rise indicates a significant enhancement in the company's financial performance and its capability to service its debt.
Throughout the following years, the interest coverage ratio remained relatively high, with slight fluctuations. By December 2024, the ratio stood at 36.19, indicating a continued strong ability to cover interest expenses with operating income, albeit at a slightly lower level compared to the peak in 2021.
Overall, Steel Dynamics Inc's interest coverage ratio demonstrates a positive performance trend, reflecting the company's sound financial management and ability to manage its debt burden effectively.