CMS Energy Corporation (CMS)

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	0.43	0.43	0.43	0.41	0.42	0.42	0.40	0.42	0.42	0.39	0.39	0.46	0.40	0.45	0.47	0.46	0.45	0.46	0.44	0.45
Debt-to-capital ratio	0.66	0.66	0.66	0.65	0.65	0.65	0.63	0.64	0.64	0.66	0.67	0.70	0.68	0.71	0.72	0.71	0.70	0.71	0.70	0.70
Debt-to-equity ratio	1.92	1.96	1.95	1.83	1.87	1.83	1.70	1.76	1.82	1.97	2.02	2.37	2.14	2.50	2.57	2.42	2.38	2.43	2.32	2.29
Financial leverage ratio	4.44	4.52	4.52	4.43	4.47	4.39	4.22	4.19	4.34	5.01	5.17	5.19	5.40	5.50	5.48	5.29	5.35	5.25	5.21	5.10

The solvency ratios of CMS Energy Corporation show consistent trends over the past few quarters. The debt-to-assets ratio has remained relatively stable around the 0.46 to 0.48 range, indicating that the company finances its assets with debt at a moderate level. The debt-to-capital ratio also demonstrates stability, hovering around 0.67 to 0.68, suggesting that a significant portion of the company's capital structure is funded through debt.

Furthermore, the debt-to-equity ratio shows a gradual increase from 1.81 in Q1 2022 to 2.15 in Q3 2023, indicating that the company's reliance on debt compared to equity has been growing. This trend suggests that CMS Energy Corporation has been increasing its leverage over time.

Lastly, the financial leverage ratio has also exhibited a slight upward trend from 4.19 in Q1 2022 to 4.52 in Q3 2023, indicating that the company's level of financial leverage has been increasing. Overall, the solvency ratios of CMS Energy Corporation reflect a moderate level of debt utilization, with a tendency towards higher leverage over the analyzed period.

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	2.61	2.40	2.47	2.42	2.79	3.73	3.82	3.90	3.90	2.97	3.04	2.96	2.68	2.87	2.84	2.72	2.76	2.48	2.44	2.61

The interest coverage ratio for CMS Energy Corporation has exhibited some fluctuation over the eight quarters presented. The ratio, calculated as earnings before interest and taxes (EBIT) divided by interest expense, ranged from a low of 1.81 in Q3 2023 to a high of 2.38 in Q4 2022. This ratio measures the company's ability to meet its interest obligations using its operating earnings.

While the interest coverage ratio has generally remained above the acceptable threshold of 2, indicating that CMS Energy Corporation generates sufficient operating profits to cover its interest expenses, the recent dip in Q3 2023 raises some concerns. Investors and creditors may monitor this trend closely to ensure that the company's earnings remain robust enough to comfortably service its interest payments in the future.