Leverage and coverage ratios, Finance Basics

Leverage and Coverage Ratios

 (The data for interest coverage are in I-Metrix's liquidity ratios section.  The others listed in this table are in the leverage ratios section.)

 

Most Recent Fiscal Year

Fiscal Year

(-1)

Fiscal Year

(-2)

Fiscal Year

(-3)

Debt/Equity

0.6223

0.6893

1.1880

0.1094

Debt/Assets

0.7906

0.7045

0.7070

0.4382

Interest Expense/Long term Debt

0.0501

0.0981

0.0324

0:no LTD

Times Interest Earned (TIE)

12.2922

9.1947

18.8934

34.7779

Interest Coverage

12.2922

9.1947

18.8934

34.7779

  1.  What trends, if any, are apparent in these ratios?
  2.  Are these favorable or unfavorable to the shareholders?
  3.  Are these favorable or unfavorable to the debt holders?
  4.  The debt/equity ratio from I-Metrix is based on book values. If you were to calculate the ratio on the basis of market values, would this ratio tend to be higher or lower than on the basis of book values? Why?
Posted Date: 3/7/2013 1:55:05 AM | Location : United States







Related Discussions:- Leverage and coverage ratios, Assignment Help, Ask Question on Leverage and coverage ratios, Get Answer, Expert's Help, Leverage and coverage ratios Discussions

Write discussion on Leverage and coverage ratios
Your posts are moderated
Related Questions
Eye Field - Vertebrate Eye The development of eyes starts with evagination of the lateral wall of the forebrain. one on each side, which make the optic vesicles. By vital dye

Working Capital a) Working capital or called gross working capital also, refers as current assets. b) Net working capital refers to current assets minus current liabilities

Charleston Industrial revised its dividend policy and decided that it wants to maintain a retained earnings account of $1 million. The company''s retained earnings account at the e

Imagine Joy is the manager of a bank named Money Talks Bank of Virginia . This bank has recently issued new loans to customers. Joy wants you, the business analyst to prepare a re

#The following is the existing capital structure of Company XYZ Ltd. Ordinary shares at Shs.10 par 1,000,000 Retained 800,000 12% preference shares Shs.10 par 400,000 16% loan Shs.

Uses and Application of Ratios Ratios are required in the following ways via managers in different firms. 1. Evaluating the efficiency of assets employment to generate sale

Important Points for Shareholders and Creditors 1. In raising capital, the borrowing firm will constantly question the financial securities in form of preference shares


jack needs to borrow $1000 for the next year. Bank south will give him the loan at 9%. Suncoast will give him the loan at 7% with a $50 loan orgination fee. First national will giv

Capital Market - Financial Markets These are markets for long term funds along with maturity time of more than one year. As like of financial instruments required here are deb