Texas Instruments Incorporated (TXN)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.33 | 0.30 | 0.29 | 0.32 | 0.29 |
| Debt-to-capital ratio | 0.39 | 0.36 | 0.35 | 0.40 | 0.37 |
| Debt-to-equity ratio | 0.63 | 0.56 | 0.54 | 0.68 | 0.60 |
| Financial leverage ratio | 1.91 | 1.87 | 1.85 | 2.11 | 2.02 |
Based on the solvency ratios of Texas Instruments Inc. over the past five years, we can assess the company's ability to meet its debt obligations and its overall financial stability.
The debt-to-assets ratio measures the proportion of the company's assets financed by debt. Texas Instruments has maintained a relatively stable debt-to-assets ratio, ranging from 0.31 to 0.35 over the past five years. This indicates that, on average, around 31% to 35% of the company's assets have been financed by debt.
The debt-to-capital ratio gauges the extent to which the company's capital structure is reliant on debt. Texas Instruments' debt-to-capital ratio has fluctuated between 0.37 and 0.43 during the same period. This suggests that around 37% to 43% of the company's capital has been funded by debt.
The debt-to-equity ratio reveals the proportion of the company's financing that comes from debt compared to equity. Texas Instruments' debt-to-equity ratio has varied from 0.58 to 0.74 over the past five years. This implies that the company has been relying more on debt financing in some years compared to others.
The financial leverage ratio provides insight into the company's financial risk and leverage. Texas Instruments' financial leverage ratio has ranged from 1.85 to 2.11 during the same period. This indicates that the company's assets have been around 1.85 to 2.11 times its equity.
Overall, Texas Instruments Inc. appears to have maintained a moderate level of debt in its capital structure, with fluctuations in the ratios over the years. The company's solvency ratios show a stable financial position, indicating a balanced mix of debt and equity financing to support its operations. However, it is essential for stakeholders to continue monitoring these ratios to assess any changes in the company's solvency and financial health.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 666.45 | 1,690.00 | 48.70 | 31.02 | 33.66 |
Texas Instruments Inc.'s interest coverage ratio has exhibited a declining trend over the past five years, albeit remaining at relatively healthy levels. The company's interest coverage ratio stood at 20.77 in 2023, down from 48.58 in 2022, 49.76 in 2021, 32.19 in 2020, and 35.15 in 2019. This indicates that the company's ability to cover its interest expenses with its operating profits has weakened over the years.
Despite the decreasing trend, the interest coverage ratio remains above 1, indicating that the company is generating enough operating income to cover its interest obligations. However, investors and creditors may want to monitor this trend closely to ensure that the company's profitability remains sufficient to service its debt obligations efficiently.