Take-Two Interactive Software Inc (TTWO)
Solvency ratios
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.25 | 0.18 | 0.18 | 0.17 | 0.11 | 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 | 0.35 | 0.24 | 0.24 | 0.23 | 0.16 | 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 | 0.54 | 0.32 | 0.32 | 0.30 | 0.19 | 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 | 2.16 | 1.75 | 1.80 | 1.74 | 1.75 | 1.77 | 1.85 | 1.84 | 1.72 | 1.73 | 1.91 | 1.74 | 1.81 | 1.89 | 2.01 | 2.03 | 1.95 | 2.03 | 2.21 | 2.09 |
Take-Two Interactive Software Inc's solvency ratios have shown some fluctuations over the past few quarters. The debt-to-assets ratio has been increasing gradually, reaching 0.25 as of March 31, 2024, indicating that 25% of the company's assets are financed by debt. This suggests a moderate level of leverage but still a relatively solid asset base.
The debt-to-capital ratio and debt-to-equity ratio have also displayed a similar increasing trend, standing at 0.35 and 0.54 respectively as of March 31, 2024. These ratios indicate that 35% of the company's capital and 54% of its equity are funded by debt, respectively. This signals a higher reliance on debt financing compared to equity, which could increase financial risk but may also be strategic for growth and investment.
The financial leverage ratio has shown some variability but has generally been on the rise, reaching 2.16 as of March 31, 2024, which is higher compared to previous periods. This ratio reflects the company's total assets relative to its equity and signifies that Take-Two Interactive Software Inc has been using more debt to finance its operations and investments, potentially magnifying returns but also increasing the risk.
Overall, the solvency ratios indicate that Take-Two Interactive Software Inc has been gradually increasing its leverage over time, which could impact its financial stability and flexibility. Monitoring these ratios closely will be essential to ensure that the company maintains a healthy balance between debt and equity to support its growth and mitigate financial risks.
Coverage ratios
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | -27.20 | -12.48 | -12.99 | -10.87 | -12.05 | -4.96 | -0.18 | 29.84 | 355.56 | 584.74 | 606.12 | 698.89 | 76.59 | 30.39 | 30.29 | 18.65 | 15.96 | 18.75 | 12.28 | 16.70 |
The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. A higher ratio indicates a stronger ability to cover interest expenses.
Looking at the historical trend of Take-Two Interactive Software Inc's interest coverage ratio, we observe significant fluctuations over the periods. For example, in the most recent quarter as of March 31, 2024, the company's interest coverage ratio was -27.20, indicating that its earnings before interest and taxes were insufficient to cover its interest expenses. This is a concerning sign as a negative interest coverage ratio suggests financial distress.
In contrast, in previous periods such as March 31, 2022, and December 31, 2021, the interest coverage ratio was 355.56 and 584.74, respectively. These values signify a robust ability to cover interest expenses with earnings, which is a positive indicator of financial health.
It is important to delve deeper into the reasons behind the significant fluctuations in the interest coverage ratio, such as changes in profitability, debt levels, and interest rates. Investors and analysts should closely monitor the company's financial performance and debt management practices to assess its ability to meet its debt obligations and sustain long-term viability.