CenterPoint Energy Inc (CNP)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 39,715,000 | 38,546,000 | 37,679,000 | 33,471,000 | 35,529,000 |
| Total stockholders’ equity | US$ in thousands | 9,667,000 | 10,042,000 | 9,415,000 | 8,348,000 | 8,359,000 |
| Financial leverage ratio | 4.11 | 3.84 | 4.00 | 4.01 | 4.25 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $39,715,000K ÷ $9,667,000K
= 4.11
The financial leverage ratio of Centerpoint Energy Inc. has fluctuated over the past five years. The ratio was 4.11 as of December 31, 2023, compared to 3.84 in 2022, 4.00 in 2021, 4.01 in 2020, and 4.24 in 2019. This ratio indicates that the company has been using debt significantly in its capital structure to finance its operations and investments. A higher financial leverage ratio means a company relies more on debt financing, which can amplify returns but also increases financial risk. The fluctuations in the ratio suggest varying levels of debt usage by the company over the years, possibly reflective of changes in the company's growth strategy, financial health, or economic conditions. It is important for stakeholders to closely monitor this ratio to assess the company's debt management and financial risk profile.
Peer comparison
Dec 31, 2023