Veralto Corporation (VLTO)

Solvency ratios provide insight into a company's ability to meet its long-term financial obligations. Looking at the data for Veralto Corporation, we can see a favorable trend in its debt-to-assets ratio, which decreased from 0.44 in June 2024 to 0.41 in December 2024. This indicates that the company has reduced its reliance on debt to finance its assets, which is a positive sign for solvency.

Similarly, the debt-to-capital and debt-to-equity ratios also show improvement over the same period. The debt-to-capital ratio decreased from 0.61 to 0.56, and the debt-to-equity ratio decreased from 1.57 to 1.28. These reductions suggest that Veralto Corporation has been able to decrease its debt levels in relation to its total capital and equity, respectively.

Moreover, the financial leverage ratio, which measures the extent to which a company uses debt to finance its operations, also improved during this period. The ratio decreased from 3.54 in June 2024 to 3.14 in December 2024, indicating a lower reliance on debt financing.

Overall, based on the analysis of these solvency ratios, it appears that Veralto Corporation has made progress in managing its debt levels and enhancing its financial stability, which can be seen as a positive indicator for its long-term solvency and financial health.

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Coverage ratios

Interest coverage is a financial ratio that measures a company's ability to pay its interest expenses on outstanding debt. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.

For Veralto Corporation, the interest coverage ratios for the periods ending on June 30, 2024, September 30, 2024, and December 31, 2024, were 12.92, 10.65, and 10.57, respectively.

The trend indicates that Veralto Corporation's interest coverage has been relatively stable over the past two quarters, averaging around 11.71. This suggests that the company has a healthy ability to cover its interest expenses with its operating income. A ratio above 1 indicates that the company is generating enough income to cover interest costs, and Veralto Corporation's ratios well exceed this threshold, indicating a strong financial position regarding its ability to service its debt obligations. Investors and creditors generally view a consistently high interest coverage ratio favorably, as it demonstrates financial stability and lower default risk.