Toro Co (TTC)

Solvency ratios

Feb 2, 2024 Oct 31, 2023 Aug 4, 2023 Feb 3, 2023 Oct 31, 2022 Jul 29, 2022 Apr 29, 2022 Jan 28, 2022 Oct 31, 2021 Jul 30, 2021 Apr 30, 2021 Jan 29, 2021 Oct 31, 2020 Jul 31, 2020 May 1, 2020 Jan 31, 2020 Oct 31, 2019 Aug 2, 2019 May 3, 2019 Feb 1, 2019
Debt-to-assets ratio 0.31 0.28 0.30 0.30 0.28 0.29 0.28 0.30 0.24 0.20 0.20 0.24 0.24 0.28 0.28 0.24 0.27 0.27 0.29 0.19
Debt-to-capital ratio 0.43 0.41 0.42 0.43 0.42 0.44 0.45 0.47 0.38 0.32 0.32 0.37 0.38 0.43 0.45 0.40 0.42 0.42 0.47 0.31
Debt-to-equity ratio 0.76 0.68 0.72 0.76 0.73 0.77 0.81 0.89 0.60 0.47 0.48 0.59 0.62 0.74 0.80 0.66 0.72 0.74 0.90 0.45
Financial leverage ratio 2.46 2.41 2.43 2.53 2.63 2.67 2.84 2.91 2.55 2.40 2.44 2.44 2.56 2.67 2.85 2.73 2.71 2.74 3.06 2.34

The solvency ratios of Toro Co. provide insights into the company's ability to meet its long-term financial obligations and manage its debt levels.

1. Debt-to-assets ratio:
The debt-to-assets ratio indicates the proportion of the company's assets financed by debt. Toro Co.'s debt-to-assets ratio has been relatively stable over the past eight quarters, ranging between 0.28 to 0.31. This implies that approximately 28% to 31% of the company's assets are funded through debt.

2. Debt-to-capital ratio:
The debt-to-capital ratio reflects the percentage of a company's capital structure that is comprised of debt. Toro Co.'s debt-to-capital ratio has fluctuated slightly but remained within a range of 0.40 to 0.47 over the same period. This suggests that debt accounts for approximately 40% to 47% of the company's total capital.

3. Debt-to-equity ratio:
The debt-to-equity ratio indicates the leverage of the company and the extent to which it relies on debt financing. Toro Co.'s debt-to-equity ratio has also varied but has generally been in the range of 0.67 to 0.89. This indicates that for every dollar of equity, the company has between $0.67 to $0.89 of debt.

4. Financial leverage ratio:
The financial leverage ratio measures the extent to which the company relies on debt to finance its operations. Toro Co.'s financial leverage ratio has shown some variability, ranging from 2.40 to 2.84. A higher ratio suggests a higher level of financial risk due to increased reliance on debt financing.

Overall, Toro Co. appears to have maintained a relatively stable level of debt across the various solvency ratios over the past eight quarters. However, the trends in these ratios should be further analyzed in conjunction with other financial metrics to assess the company's overall financial health and risk management strategies.

Coverage ratios

Feb 2, 2024 Oct 31, 2023 Aug 4, 2023 Feb 3, 2023 Oct 31, 2022 Jul 29, 2022 Apr 29, 2022 Jan 28, 2022 Oct 31, 2021 Jul 30, 2021 Apr 30, 2021 Jan 29, 2021 Oct 31, 2020 Jul 31, 2020 May 1, 2020 Jan 31, 2020 Oct 31, 2019 Aug 2, 2019 May 3, 2019 Feb 1, 2019
Interest coverage 4.99 6.53 8.65 14.49 16.11 16.00 15.78 16.64 18.08 18.21 17.36 14.99 13.28 11.81 10.42 11.49 12.17 13.50 16.89 20.03

The interest coverage of Toro Co. has shown a general decreasing trend over the past eight quarters, starting at 16.11 in Q4 2022 and decreasing to 8.79 in Q1 2024. This indicates that the company's ability to cover its interest expenses with its operating income has weakened over time.

A lower interest coverage ratio suggests that Toro Co. may be facing challenges in generating enough operating income to cover its interest obligations. This could be a sign of increasing debt levels, declining profitability, or inefficient operations.

While it is positive to see the interest coverage ratio fluctuate within a relatively healthy range, management should closely monitor this trend and take proactive measures to improve the company's ability to meet its interest payments in the long term. Strengthening profitability, reducing debt levels, or optimizing operational efficiency could help improve Toro Co.'s interest coverage ratio and overall financial health.