Worthington Industries Inc (WOR)
Solvency ratios
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 1.84 | 2.15 | 2.46 | 2.41 | 2.84 |
Worthington Industries Inc has exhibited a strong solvency position based on its solvency ratios analysis. The debt-to-assets ratio, which measures the proportion of a company's assets financed by debt, has consistently stood at 0.00 over the years from May 31, 2020, to May 31, 2024. This indicates that the company has not relied on debt to finance its assets during this period.
Similarly, the debt-to-capital ratio, reflecting the percentage of a company's capital structure that comes from debt, has also remained at 0.00 across the same period. This signifies that Worthington Industries' capital has been predominantly sourced from equity rather than debt.
Furthermore, the debt-to-equity ratio, comparing a company's total debt to its total equity, has consistently been 0.00 during the specified years. This suggests that the company has a minimal level of debt relative to its equity, emphasizing a low risk associated with financial leverage.
Regarding the financial leverage ratio, which indicates the extent to which a company relies on debt to finance its operations, there has been a decreasing trend from 2.84 on May 31, 2020, to 1.84 on May 31, 2024. This decreasing trend demonstrates that Worthington Industries has been reducing its reliance on debt financing over the years, which can enhance its financial stability and reduce potential financial risks.
Overall, the solvency ratios of Worthington Industries Inc reflect a conservative and financially stable approach with low debt levels and prudent capital structure management over the analyzed period.
Coverage ratios
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 47.75 | 1.36 | 17.41 | 9.49 | 7.56 |
The interest coverage ratio for Worthington Industries Inc has varied over the years. As of May 31, 2020, the company had an interest coverage ratio of 7.56, indicating that it was generating enough operating income to cover its interest expenses 7.56 times. By May 31, 2021, this ratio had improved to 9.49, suggesting a stronger ability to cover interest costs.
The year ending May 31, 2022, saw a significant increase in Worthington Industries Inc's interest coverage ratio to 17.41, reflecting a substantial improvement in the company's ability to meet its interest obligations comfortably. However, by May 31, 2023, the interest coverage ratio dropped to 1.36, indicating a potential strain on the company's finances in relation to meeting interest payments.
Interestingly, by May 31, 2024, Worthington Industries Inc's interest coverage ratio surged remarkably to 47.75, demonstrating a robust capacity to service its interest expenses with its operating income multiple times over.
Overall, fluctuations in Worthington Industries Inc's interest coverage ratio over the years suggest varying levels of financial stability and efficiency in managing its interest obligations. It is advisable for stakeholders to closely monitor these ratios to assess the company's financial health and debt servicing capability.