- Solvency ratios (44): Give the analyst information on firm’s financial leverage and ability to meet long term obligations
- Debt ratios (45): based on balance sheet
- Suggest reliance on debt as a source of financing
- Total debt is calculated differently by different analyst
- Long term debt + interest bearing current liabilities
- Debt to capital ratios (46)
- Debt to asset ratios (47)
- Financing leverage (48)
- Average: average of the beginning and the end of each period
- Interest coverage (49)
- Lower the ratio, the more likely the firm have difficulty meeting debt payments
- Fixed charge coverage (50)
- Significant lease obligation will reduce ratio significantly
- Debt ratios (45): based on balance sheet
