Woodward Inc (WWD)
Solvency ratios
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.13 | 0.16 | 0.19 | 0.18 | 0.19 |
| Debt-to-capital ratio | 0.21 | 0.24 | 0.27 | 0.25 | 0.27 |
| Debt-to-equity ratio | 0.26 | 0.31 | 0.37 | 0.33 | 0.37 |
| Financial leverage ratio | 2.01 | 1.94 | 2.00 | 1.85 | 1.96 |
Woodward Inc's solvency ratios, as indicated in the table, demonstrate a favorable trend over the past five years. The debt-to-assets ratio has decreased from 0.19 in 2020 to 0.13 in 2024, indicating that the company has reduced its reliance on debt to finance its assets. This suggests an improvement in the company's ability to cover its obligations with its assets.
Similarly, the debt-to-capital ratio and debt-to-equity ratio have shown a decreasing trend from 2020 to 2024, indicating a lower proportion of debt in the company's overall capital structure. This suggests that Woodward Inc has been successful in reducing its debt burden relative to its total capital and equity, thereby enhancing its financial stability.
Furthermore, the financial leverage ratio has shown a slight increase from 1.85 in 2021 to 2.01 in 2024, indicating that the company has slightly increased its reliance on debt compared to equity and retained earnings. However, the overall trend of improving debt ratios indicates that Woodward Inc has efficiently managed its debt levels, resulting in a stronger financial position and lower financial risk.
Overall, Woodward Inc's solvency ratios reflect a positive trajectory, demonstrating a prudent approach to managing its debt obligations and maintaining a healthy balance between debt and equity in its capital structure.
Coverage ratios
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 10.47 | 6.76 | 6.79 | 8.17 | 8.87 |
The interest coverage ratio for Woodward Inc has shown a general trend of improvement over the past five years. It was 10.47 in 2024, which indicates that the company was able to cover its interest expenses over 10 times using its operating income. This is a positive sign that reflects the company's ability to meet its interest obligations comfortably.
Comparing this to the previous years, the interest coverage ratio has been steadily increasing from 6.79 in 2022 to 10.47 in 2024. This implies that Woodward Inc has been generating a higher operating income relative to its interest expenses, which is a good indication of financial health and stability.
Overall, the trend of increasing interest coverage ratio over the years suggests that Woodward Inc is effectively managing its debt and is in a strong position to service its interest payments. Investors and creditors may view this positively as it indicates the company's ability to meet its financial obligations with ease.