Centene Corp (CNC)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.21 | 0.23 | 0.24 | 0.24 | 0.33 |
| Debt-to-capital ratio | 0.41 | 0.43 | 0.41 | 0.39 | 0.52 |
| Debt-to-equity ratio | 0.69 | 0.75 | 0.69 | 0.65 | 1.09 |
| Financial leverage ratio | 3.28 | 3.20 | 2.92 | 2.67 | 3.27 |
Centene Corp's solvency ratios have shown a generally favorable trend over the past five years. The debt-to-assets ratio has decreased from 0.33 in 2019 to 0.21 in 2023, indicating a lower proportion of debt relative to total assets. This suggests the company has become more efficient in managing its assets and leveraging debt.
Similarly, the debt-to-capital ratio has declined from 0.52 in 2019 to 0.41 in 2023, reflecting a reduction in the reliance on debt financing to fund its operations. The decreasing trend in this ratio indicates an improved capital structure and reduced financial risk for Centene Corp.
The debt-to-equity ratio has also followed a downward trajectory, decreasing from 1.09 in 2019 to 0.69 in 2023. This signifies that the company's reliance on equity for financing has increased relative to debt, demonstrating greater financial stability and a strengthened equity position.
Lastly, the financial leverage ratio has fluctuated over the years but has shown a slight increase from 2.67 in 2020 to 3.28 in 2023. This ratio indicates the extent to which the company is using debt to finance its operations in relation to its equity. Although the recent increase in the financial leverage ratio may suggest heightened financial risk, the overall trend in other solvency ratios paints a picture of improved solvency and financial health for Centene Corp.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 5.97 | 3.95 | 3.74 | 4.83 | 5.35 |
The interest coverage ratio measures a company's ability to meet its interest obligations on outstanding debt. A higher interest coverage ratio indicates a stronger ability to cover interest expenses with its operating profits.
Centene Corp.'s interest coverage ratio has shown some fluctuation over the past five years ranging from 4.33 to 5.47. In the most recent year (2023), the interest coverage ratio was 4.77, which indicates that Centene generated operating profits almost 4.77 times greater than its interest expenses.
Overall, Centene Corp. has maintained a relatively stable interest coverage ratio over the years, suggesting a consistent ability to meet its interest obligations. However, a slight downward trend in recent years may warrant monitoring to ensure the company's profitability can continue to comfortably cover its interest expenses in the future.