CMS Energy Corporation (CMS)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 33,517,000 | 31,353,000 | 28,753,000 | 29,666,000 | 26,837,000 |
| Total stockholders’ equity | US$ in thousands | 7,544,000 | 7,015,000 | 6,631,000 | 5,496,000 | 5,018,000 |
| Financial leverage ratio | 4.44 | 4.47 | 4.34 | 5.40 | 5.35 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $33,517,000K ÷ $7,544,000K
= 4.44
The financial leverage ratio of CMS Energy Corporation has experienced fluctuations over the past five years. The ratio decreased from 5.35 in 2019 to 4.34 in 2021, indicating a reduction in the company's reliance on debt to finance its operations during this period. However, the ratio slightly increased to 4.47 in 2022 before decreasing to 4.44 in 2023.
Overall, the company has maintained a relatively high financial leverage ratio, ranging between 4.34 and 5.40 during the period under review. This suggests that CMS Energy Corporation has a significant level of debt in its capital structure compared to its equity, which may expose the company to higher financial risk and interest rate fluctuations. It is important for the company to carefully manage its debt levels to ensure financial stability and sustainability in the long term.
Peer comparison
Dec 31, 2023