Teradyne Inc (TER)
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 | 0.02 | 0.10 | 0.14 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.03 | 0.15 | 0.21 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.03 | 0.17 | 0.27 |
| Financial leverage ratio | 1.38 | 1.43 | 1.49 | 1.65 | 1.88 |
Teradyne, Inc.'s solvency ratios indicate a strong financial position and decreasing reliance on debt over the past five years. The debt-to-assets ratio has consistently decreased from 0.14 in 2019 to 0.03 in 2021 and then to 0.01 in 2022, with no debt recorded in 2023. This trend suggests that Teradyne's assets are largely financed through equity rather than debt.
Similarly, the debt-to-capital and debt-to-equity ratios show a decreasing trend, indicating lower levels of debt relative to capital and equity. The debt-to-capital ratio declined from 0.21 in 2019 to 0.02 in 2022, with no debt recorded in 2023. The debt-to-equity ratio also experienced a decline from 0.27 in 2019 to 0.04 in 2022, with again no debt reported in 2023.
Additionally, the financial leverage ratio, which provides insight into the company's ability to meet its financial obligations, has reduced steadily over the years. The ratio decreased from 1.88 in 2019 to 1.38 in 2023. This indicates that Teradyne has been decreasing its reliance on debt to fund its operations and is moving towards a more equity-based financial structure, which enhances solvency and reduces financial risk.
Overall, Teradyne, Inc.'s solvency ratios reflect a prudent financial strategy focused on maintaining a healthy balance between debt and equity to support its long-term financial stability and growth.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 139.09 | 226.97 | 66.15 | 38.26 | 24.66 |
The interest coverage ratio for Teradyne, Inc. is not available for the years 2020 and 2023. In 2021, the interest coverage ratio was 79.64, indicating that the company's operating income was sufficient to cover its interest expenses nearly 80 times. This high ratio suggests that Teradyne had a comfortable buffer to meet its interest obligations. Moreover, in 2019, the interest coverage ratio was not available.
It is important to note that without the complete trend analysis of interest coverage over more years, it is challenging to assess the consistency and trajectory of Teradyne's ability to cover its interest expenses from operating income alone. To gain a more comprehensive understanding of the company's financial health, other financial ratios and qualitative factors should also be considered.