Xerox Corp (XRX)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 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 | 7.77 | 3.94 | 3.45 | 2.98 | 2.64 |
The solvency ratios of Xerox Corp indicate a strong financial position with consistently low debt levels relative to its assets, capital, and equity. The Debt-to-assets ratio, Debt-to-capital ratio, and Debt-to-equity ratio have all remained at 0.00 from December 31, 2020, through December 31, 2024, suggesting that the company's debt obligations are well-managed and pose minimal risk to its overall financial health.
However, the Financial leverage ratio shows an increasing trend over the same period, starting at 2.64 on December 31, 2020, and rising to 7.77 by December 31, 2024. This significant increase indicates that the company's reliance on debt to finance its operations has been escalating over time, which could potentially increase financial risk and impact the company's ability to service its debt obligations in the long run.
Overall, while Xerox Corp currently maintains a solid solvency position with negligible debt ratios, the increasing financial leverage ratio warrants monitoring to ensure continued financial stability and sustainability in the future.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | -4.40 | 0.86 | -0.63 | -1.28 | 2.19 |
Xerox Corp's interest coverage ratio has fluctuated significantly over the past five years. As of December 31, 2020, the interest coverage ratio was 2.19, indicating the company generated more than enough earnings to cover its interest expenses. However, by December 31, 2021, the ratio turned negative to -1.28, suggesting that the company's earnings were insufficient to cover its interest payments.
This negative trend continued into 2022 and 2024, with interest coverage ratios of -0.63 and -4.40, respectively. These figures indicate a concerning financial position as the company's earnings were not able to cover its interest costs during these years.
By December 31, 2023, there was a slight improvement in the interest coverage ratio to 0.86. While this figure remains below 1, indicating that the company's earnings just about covered its interest expenses, it shows a potential sign of stabilization in the company's financial position.
Overall, the fluctuating interest coverage ratios of Xerox Corp suggest inconsistent financial performance in meeting its interest obligations, indicating a need for close monitoring of its financial health and potential strategies to improve earnings and manage debt levels.