Terex Corporation (TEX)

Terex Corporation's solvency ratios have shown a positive trend over the years. The Debt-to-assets ratio has decreased from 0.38 in 2020 to 0.00 in 2024, indicating a reduced dependence on debt to finance its assets. Similarly, the Debt-to-capital ratio and Debt-to-equity ratio have also shown declining trends, suggesting improved financial health and lower financial risk. The Financial leverage ratio decreased from 3.29 in 2020 to 2.16 in 2023, although it increased slightly to 3.13 in 2024. Overall, the decreasing trend in these solvency ratios indicates that Terex Corporation has been effectively managing its debt levels and improving its financial stability.

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Coverage ratios

Based on the provided data, Terex Corporation's interest coverage ratio has shown variability over the years. As of December 31, 2020, the interest coverage was relatively low at 0.87, indicating that the company's operating income was only sufficient to cover its interest expenses less than once.

However, there has been a significant improvement in the interest coverage ratio in subsequent years. By December 31, 2021, the ratio had increased to 6.19, showing that the company's operating income was able to cover its interest expenses more than six times over. This improvement suggests a better financial position and reduced risk of default due to insufficient coverage of interest obligations.

The positive trend continues in the following years, with the interest coverage ratios reaching 8.46 by December 31, 2022, 10.23 by December 31, 2023, and then slightly dropping to 5.58 by December 31, 2024. Overall, the improving trend in the interest coverage ratio indicates that Terex Corporation has been effectively managing its interest expenses in relation to its operating income, which is a positive sign for its financial stability and ability to meet debt obligations. However, the slight decrease in 2024 could warrant further monitoring to ensure sustained financial health and stability.