American Electric Power Company Inc (AEP)

Debt-to-assets ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	37,652,700	34,314,600	31,300,700	28,986,400	25,126,800
Total assets	US$ in thousands	96,684,000	93,403,300	87,668,700	80,757,200	75,892,300
Debt-to-assets ratio		0.39	0.37	0.36	0.36	0.33

December 31, 2023 calculation

Debt-to-assets ratio = Long-term debt ÷ Total assets
= $37,652,700K ÷ $96,684,000K
= 0.39

The debt-to-assets ratio of American Electric Power Company Inc. has exhibited a fluctuating trend over the past five years. The ratio increased from 0.39 in 2019 to 0.44 in 2023, indicating that the company's proportion of debt to total assets has risen. However, it is worth noting that the ratio remained relatively stable within a narrow range between 0.41 and 0.43 in the intervening years (2020-2022).

A rising debt-to-assets ratio may suggest that the company has been relying more on debt financing to fund its operations and investments compared to its total asset base. This could potentially increase the company's financial risk and leverage.

It is important for stakeholders to closely monitor the trend in the debt-to-assets ratio to assess the company's ability to manage its debt levels effectively, maintain financial stability, and generate sustainable returns for investors. Further analysis and comparison with industry peers would provide additional insights into the company's capital structure and financial health.