Clear Secure Inc (YOU)

Clear Secure Inc has consistently maintained a debt-free capital structure over the past three years, as evidenced by the debt-to-assets, debt-to-capital, and debt-to-equity ratios all being at 0.00 in each year. This indicates that the company does not rely on debt financing to support its operations and growth.

However, the financial leverage ratio has been increasing steadily over the same period, reaching 4.48 in 2023. This suggests that Clear Secure Inc has been increasingly funding its operations through equity rather than debt. While a higher financial leverage ratio may indicate higher risk due to increased reliance on equity, in this case, since the company has no debt, the increase in financial leverage ratio likely reflects a deliberate strategic choice to use more equity financing to support its growth and expansion plans.

Overall, Clear Secure Inc's solvency ratios reflect a strong and stable financial position with minimal financial risk stemming from debt obligations. The increasing financial leverage ratio indicates the company's prudent approach to maintaining a healthy balance between debt and equity in its capital structure.

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Coverage ratios

The interest coverage ratio measures the ability of Clear Secure Inc to meet its interest obligations from its operating income. A higher interest coverage ratio indicates a greater ability to cover interest expenses.

In 2023, Clear Secure Inc's interest coverage ratio improved significantly to 59.40 from negative figures in the previous two years. This indicates that the company's operating income is now significantly more capable of covering its interest expenses, reflecting a healthier financial position compared to the prior years.

It is worth noting that a negative interest coverage ratio, as seen in 2022 and 2021, suggests that Clear Secure Inc was unable to cover its interest expenses with its operating income during those periods. This could be a concerning sign of financial distress and possible insolvency risk.

Overall, the positive trend in Clear Secure Inc's interest coverage ratio from negative in 2022 and 2021 to a positive and considerably higher ratio in 2023 indicates an improvement in the company's ability to meet its interest obligations. However, continued monitoring of this ratio is recommended to ensure the company's long-term financial health.