Toll Brothers Inc (TOL)
Solvency ratios
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 1.78 | 1.84 | 1.85 | 1.87 | 1.93 | 2.05 | 2.13 | 2.15 | 2.15 | 2.18 | 2.24 | 2.23 | 2.27 | 2.27 | 2.25 | 2.37 | 2.27 | 2.13 | 2.12 | 2.08 |
The solvency ratios of Toll Brothers Inc. reflect its ability to meet its long-term debt obligations. Looking at the trend over the quarters, we observe a consistent increase in the Debt-to-assets ratio, from 0.22 in Q1 2024 to 0.29 in Q2 2022. This suggests that the company's debt in relation to its total assets has been gradually rising.
Similarly, the Debt-to-capital ratio has also been increasing steadily, from 0.28 in Q1 2024 to 0.38 in Q2 2022. This indicates that the proportion of debt relative to the total capital employed by the company has been on the rise.
The Debt-to-equity ratio has shown a similar upward trend, increasing from 0.39 in Q1 2024 to 0.62 in Q2 2022. This implies that the company has been relying more on debt financing compared to equity financing, which could potentially pose higher financial risk.
Lastly, the Financial leverage ratio has also been on the rise, from 1.78 in Q1 2024 to 2.15 in Q2 2022. This ratio indicates the extent to which the company is using debt to finance its assets, with a higher ratio suggesting higher financial risk and dependence on debt.
Overall, the increasing trend in all solvency ratios suggests that Toll Brothers Inc. may be becoming more leveraged and reliant on debt financing to support its operations and growth, which raises concerns about its long-term financial stability and ability to manage debt effectively. Monitoring these ratios going forward will be crucial in assessing the company's solvency risk and financial health.
Coverage ratios
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 41.12 | 19.62 | 13.64 | 12.13 | 9.78 | 10.68 | 12.20 | 9.35 | 7.39 | 7.96 | 11.74 | 15.92 | 59.03 | 237.90 | — | — | — | — | — | — |
The interest coverage ratio for Toll Brothers Inc. has shown a fluctuating trend over the past eight quarters. In Q1 2023, the interest coverage ratio was 998.80, indicating that the company generated almost 1,000 times more earnings before interest and taxes (EBIT) than it needed to cover its interest expenses for that quarter. This ratio improved slightly in Q2 2023 to 1,085.97 and further increased in Q3 2023 to 1,202.15, reflecting an enhanced ability to meet interest obligations with operating earnings on both occasions.
However, in Q2 2022 and Q3 2022, Toll Brothers Inc.'s interest coverage ratios were substantially lower at 7.83 and 8.12, respectively. These figures suggest that the company's ability to cover interest expenses with operating earnings was relatively weaker during that period, potentially posing a higher risk of default or financial strain. Notably, data for Q1 2024 and Q4 2022 are not available, limiting a complete analysis of the recent performance of the interest coverage ratio.
Overall, the varying levels of interest coverage ratio indicate fluctuations in Toll Brothers Inc.'s financial health and ability to meet its interest obligations from operating profits.