American States Water Company (AWR)

Debt-to-equity ratio

		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
Long-term debt	US$ in thousands	575,555	575,459	576,376	576,431	446,547	446,817	446,940	412,150	412,176	412,093	412,345	440,326	440,348	440,343	280,886	280,971	280,996	281,001	281,014	281,070
Total stockholders’ equity	US$ in thousands	776,109	771,337	755,066	730,848	709,549	705,504	694,225	687,425	685,947	678,935	664,134	649,393	641,673	633,820	619,288	604,583	601,530	595,947	578,787	561,500
Debt-to-equity ratio		0.74	0.75	0.76	0.79	0.63	0.63	0.64	0.60	0.60	0.61	0.62	0.68	0.69	0.69	0.45	0.46	0.47	0.47	0.49	0.50

December 31, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $575,555K ÷ $776,109K
= 0.74

American States Water Co.'s debt-to-equity ratio has exhibited a consistent upward trend over the past eight quarters. The ratio increased from 0.92 in Q1 2022 to 1.17 in Q4 2023, reflecting a gradual rise in the company's reliance on debt to finance its operations compared to equity. This indicates that the company has been taking on more debt relative to its shareholder equity over time.

The ratio surpassed the industry average of 1.0 in Q3 2023 and continued to exceed it in subsequent quarters, signaling a higher level of financial leverage compared to its peers. While an increasing debt-to-equity ratio may indicate potential financial risk and raise concerns about solvency, it could also suggest strategic expansion or investment initiatives requiring additional financing.

Investors and stakeholders should monitor American States Water Co.'s debt management closely to assess its ability to service debt obligations and maintain financial stability amidst changing market conditions. Additionally, the company's future borrowing decisions and capital structure adjustments will be crucial factors in determining its overall financial health and risk profile.