The AES Corporation (AES)
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 | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 2,488,000 | 2,437,000 | 2,798,000 | 2,634,000 | 2,996,000 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $2,488,000K)
= 0.00
The debt-to-capital ratio of AES Corp. has shown a fluctuating trend over the past five years, ranging from 0.87 in 2019 and 2021 to a peak of 0.92 in 2023. This ratio indicates the proportion of the company's capital structure that is financed by debt.
The increasing trend in the debt-to-capital ratio suggests that AES Corp. has been relying more on debt to finance its operations and investment activities in recent years. This could be a strategic decision to take advantage of low-interest rate environments or to fund growth opportunities.
Overall, it is important for investors and analysts to monitor changes in the debt-to-capital ratio as it can reflect the financial leverage and risk exposure of the company. A higher ratio indicates higher financial risk due to a greater reliance on debt financing, while a lower ratio may signify a more conservative financial approach.