APA Corporation (APA)
Solvency ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.34 | 0.00 | 0.00 | 0.00 | 0.51 | 0.00 | 0.00 | 0.62 | 0.69 | 0.68 | 0.66 | 0.62 | 0.47 | 0.39 | 0.37 | 0.37 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.68 | 0.00 | 0.00 | 0.00 | 1.09 | — | — | 1.05 | 1.23 | 1.23 | 1.24 | 1.18 | 0.72 | 0.57 | 0.55 | 0.54 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 2.16 | 0.00 | 0.00 | 0.00 | — | — | — | — | — | — | — | — | 2.63 | 1.33 | 1.25 | 1.16 |
| Financial leverage ratio | 3.58 | 4.78 | 5.40 | 5.93 | 6.31 | 7.75 | 9.18 | 14.48 | — | — | — | — | — | — | — | — | 5.56 | 3.40 | 3.33 | 3.11 |
Looking at the solvency ratios of APA Corporation from Q4 2022 to Q4 2023, we observe fluctuations in its debt-related metrics.
The debt-to-assets ratio has shown a declining trend from 0.44 in Q1 2023 to 0.34 in Q4 2023, indicating that the company has been able to reduce its reliance on debt in financing its assets over the period.
Similarly, the debt-to-capital ratio has decreased from 0.93 in Q1 2023 to 0.66 in Q4 2023, reflecting an improvement in the company's ability to cover its financial obligations with its capital sources.
The debt-to-equity ratio has fluctuated significantly, peaking at 13.06 in Q1 2023 and reducing to 1.95 in Q4 2023. This suggests a significant shift in the company's capital structure over the quarters, with Q1 2023 reflecting a higher reliance on debt to fund operations.
The financial leverage ratio also exhibits volatility, ranging from 5.74 in Q4 2022 to 31.08 in Q1 2023. This indicates the company's varying levels of debt relative to its equity and assets, with higher ratios signaling a higher financial risk and leverage.
Overall, APA Corporation's solvency ratios show a mix of improvements and fluctuations in its debt management and capital structure over the analyzed period. It is essential for stakeholders to monitor these ratios for insights into the company's financial health and risk profile.
Coverage ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 12.37 | 12.88 | 13.72 | 17.02 | 18.01 | 15.82 | 13.20 | 9.50 | 6.89 | 8.72 | 6.17 | 3.02 | -16.09 | -18.99 | -19.85 | -15.98 | -5.12 | 1.24 | 2.02 | 3.80 |
The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher interest coverage ratio indicates that the company is more capable of servicing its debt obligations.
In the case of APA Corporation, the interest coverage ratio has shown fluctuations over the past eight quarters. The ratio ranged from a low of 9.40 in Q1 2022 to a high of 15.89 in Q4 2022. Overall, the trend has been relatively stable, with some variability.
The interest coverage ratio exceeding 1 indicates that APA Corporation has sufficient earnings to cover its interest payments. In this scenario, APA Corporation has consistently demonstrated strong ability to meet its interest obligations, with ratios well above the threshold. The highest interest coverage ratio of 15.89 in Q4 2022 suggests that the company had ample earnings to cover its interest expenses during that quarter.
However, it's important to note that the interest coverage ratio alone does not provide a complete picture of the company's financial health. It should be analyzed in conjunction with other financial metrics and factors affecting the company's operations and industry dynamics.