Alcoa Corp (AA)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,732,000 | 1,806,000 | 1,726,000 | 2,463,000 | 1,799,000 |
| Total stockholders’ equity | US$ in thousands | 4,251,000 | 5,076,000 | 4,672,000 | 3,311,000 | 4,112,000 |
| Debt-to-capital ratio | 0.29 | 0.26 | 0.27 | 0.43 | 0.30 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,732,000K ÷ ($1,732,000K + $4,251,000K)
= 0.29
The debt-to-capital ratio of Alcoa Corp has fluctuated over the past five years. As of December 31, 2023, the ratio stands at 0.30, indicating that 30% of the company's capital structure is funded by debt. This represents a slight increase from the previous year but is lower than the ratio in 2020 when it was at 0.43.
The trend over the past five years shows some variability, with the ratio moving between 0.26 and 0.43. A lower debt-to-capital ratio signifies a lower level of financial risk for the company as it indicates a smaller reliance on debt financing. In contrast, a higher ratio suggests a greater proportion of debt in the capital structure, which can increase financial risk and interest payment obligations.
Overall, the current debt-to-capital ratio of 0.30 for Alcoa Corp indicates a balanced approach to financing its operations, with a significant portion of the capital structure funded by equity. This suggests a moderate level of financial risk and a relatively stable debt position for the company.
Peer comparison
Dec 31, 2023