APA Corporation (APA)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 16,944,000 | 14,255,000 | 14,393,000 | 12,746,000 | 18,107,000 |
| Total stockholders’ equity | US$ in thousands | 4,732,000 | 2,258,000 | -618,000 | -1,639,000 | 3,255,000 |
| Financial leverage ratio | 3.58 | 6.31 | — | — | 5.56 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $16,944,000K ÷ $4,732,000K
= 3.58
The financial leverage ratio of APA Corporation has varied significantly over the past five years. In 2019 and 2023, the financial leverage ratio was 5.56 and 5.74, respectively, indicating that the company relied more on debt to finance its operations compared to its equity.
In 2022, the financial leverage ratio spiked up to 31.08, signaling a substantial increase in the company's reliance on debt. The absence of data for 2021 and 2020 makes it challenging to analyze the trend further, but it is crucial to note the dramatic shift in leverage in 2022.
The high financial leverage ratios suggest that APA Corporation may have a high level of debt relative to its equity, which could potentially increase financial risk and make the company more sensitive to changes in interest rates or economic conditions. Monitoring the trend of the financial leverage ratio over time will be essential for assessing the company's long-term financial health and stability.
Peer comparison
Dec 31, 2023