Worthington Steel Inc (WS)

Worthington Steel Inc has consistently maintained a debt-free status as evidenced by a debt-to-assets, debt-to-capital, and debt-to-equity ratio of 0.00 for the past four fiscal years (2021-2024). This indicates that the company has not utilized debt to finance its operations or investments during this period.

However, the financial leverage ratio for Worthington Steel Inc has fluctuated over the same period, ranging from 1.71 to 2.07. The increasing trend from 2021 to 2024 suggests that the company has been increasingly reliant on equity financing to support its operations. A higher financial leverage ratio implies a higher proportion of debt in the company's capital structure, which could potentially indicate increased financial risk.

Overall, despite the absence of debt in its capital structure, the increasing financial leverage ratio implies that Worthington Steel Inc has been utilizing more equity financing in recent years, which may impact its financial risk profile and operational flexibility. Continued monitoring of the financial leverage ratio is recommended to assess the company's long-term solvency and financial stability.

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Coverage ratios

The interest coverage ratio for Worthington Steel Inc for the most recent fiscal year ended on May 31, 2024, is reported as 0.00. This indicates that the company's operating income was insufficient to cover its interest expenses during that period. A zero interest coverage ratio is a concerning metric as it suggests a severe financial strain on the company's ability to meet its interest obligations. This could potentially signal financial distress and raise red flags for creditors and investors. It is crucial for Worthington Steel Inc to closely monitor and address this issue by improving its operating performance, generating higher income, or reducing its debt levels to enhance its ability to cover interest payments in the future.