Williams-Sonoma Inc (WSM)
Solvency ratios
| Jan 28, 2024 | Jan 29, 2023 | Jan 30, 2022 | Jan 31, 2021 | Feb 2, 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 | 2.48 | 2.74 | 2.78 | 2.82 | 3.28 |
The solvency ratios of Williams-Sonoma Inc indicate a consistently strong financial position over the past five years. The debt-to-assets, debt-to-capital, and debt-to-equity ratios have all been at 0.00 for each year, indicating that the company has been able to finance its assets primarily through equity rather than debt. This reflects a low level of financial risk and a strong ability to meet its financial obligations.
The financial leverage ratio, which measures the extent of a company's financial leverage, has shown a decreasing trend over the past five years. A decreasing trend in the financial leverage ratio signifies that the company is becoming less reliant on debt to finance its operations and investments. Williams-Sonoma Inc's financial leverage ratio has decreased from 3.28 in 2020 to 2.48 in 2024, indicating a reduction in financial risk and a more conservative capital structure.
Overall, based on the solvency ratios analyzed, Williams-Sonoma Inc appears to have a solid financial health, with a strong ability to cover its financial obligations and maintain a stable and sustainable capital structure.
Coverage ratios
| Jan 28, 2024 | Jan 29, 2023 | Jan 30, 2022 | Jan 31, 2021 | Feb 2, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 42.66 | 663.02 | 779.15 | 56.11 | 52.62 |
Williams-Sonoma Inc's interest coverage ratio has exhibited significant fluctuations over the past five years. The interest coverage ratio indicates the company's ability to pay its interest expenses from its earnings before interest and taxes (EBIT).
In the latest fiscal year ending on January 28, 2024, the interest coverage ratio was 42.66, suggesting that the company generated earnings that were 42.66 times greater than its interest expenses. This indicates a healthy ability to cover interest payments.
However, it is noteworthy that the interest coverage ratio experienced a sharp decline from the previous fiscal year, where it was significantly higher at 663.02. This substantial decrease in the ratio could be attributed to various factors, such as fluctuations in EBIT or changes in interest expenses.
Looking at the historical trend, Williams-Sonoma Inc's interest coverage ratio has demonstrated variations, with notable peaks in fiscal years 2022 and 2023 (779.15 and 663.02, respectively), indicating robust financial health in those periods. The ratios for fiscal years 2021 and 2020 were also relatively strong at 56.11 and 52.62, respectively, signifying a stable ability to cover interest obligations.
Overall, while the recent decline in the interest coverage ratio warrants attention, the company's historical performance suggests a generally healthy ability to meet its interest payments, with some fluctuations in recent years.