Cleveland-Cliffs Inc (CLF)
Debt-to-equity ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 7,065,000 | 3,137,000 | 4,249,000 | 5,238,000 | 5,390,000 |
| Total stockholders’ equity | US$ in thousands | 6,664,000 | 7,887,000 | 7,791,000 | 5,490,000 | 2,018,000 |
| Debt-to-equity ratio | 1.06 | 0.40 | 0.55 | 0.95 | 2.67 |
December 31, 2024 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $7,065,000K ÷ $6,664,000K
= 1.06
The debt-to-equity ratio of Cleveland-Cliffs Inc has exhibited a notable downward trend over the past five years, indicating an improvement in the company's overall financial leverage and risk profile. Starting at 2.67 as of December 31, 2020, the ratio decreased to 0.95 by the end of 2021, followed by further declines to 0.55 in 2022, 0.40 in 2023, and a subsequent increase to 1.06 by December 31, 2024.
The significant drop in the ratio from 2020 to 2023 suggests that Cleveland-Cliffs Inc has been successful in reducing its reliance on debt relative to equity, which can lead to a more stable and sustainable capital structure. However, the subsequent increase in the ratio in 2024 may indicate a potential shift in the company's financing strategy towards more debt utilization, necessitating careful monitoring to ensure prudent financial management going forward.
Peer comparison
Dec 31, 2024