CenterPoint Energy Inc (CNP)
Financial leverage ratio
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 39,715,000 | 39,001,000 | 38,097,000 | 37,752,000 | 38,546,000 | 36,719,000 | 36,216,000 | 35,202,000 | 37,679,000 | 37,160,000 | 36,466,000 | 35,906,000 | 33,471,000 | 32,705,000 | 32,148,000 | 33,395,000 | 35,529,000 | 34,642,000 | 34,189,000 | 33,902,000 |
| Total stockholders’ equity | US$ in thousands | 9,667,000 | 9,585,000 | 10,366,000 | 10,356,000 | 10,042,000 | 9,989,000 | 10,023,000 | 9,951,000 | 9,415,000 | 8,865,000 | 8,870,000 | 8,716,000 | 8,348,000 | 8,388,000 | 8,392,000 | 6,970,000 | 8,359,000 | 8,346,000 | 8,257,000 | 8,216,000 |
| Financial leverage ratio | 4.11 | 4.07 | 3.68 | 3.65 | 3.84 | 3.68 | 3.61 | 3.54 | 4.00 | 4.19 | 4.11 | 4.12 | 4.01 | 3.90 | 3.83 | 4.79 | 4.25 | 4.15 | 4.14 | 4.13 |
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 shown fluctuation over the past eight quarters. The ratio has ranged from 3.54 to 4.11 during this period. It increased from 3.54 in Q1 2022 to a peak of 4.11 in Q4 2023, indicating an increase in the company's reliance on debt to finance its operations and investments. This level of leverage suggests that the company has a higher proportion of debt in its capital structure compared to equity.
The fluctuations in the financial leverage ratio may reflect changes in the company's capital structure, debt levels, or overall financial risk. A higher financial leverage ratio indicates higher financial risk due to the increased reliance on debt funding, which may lead to higher interest expenses and lower financial flexibility. Conversely, a lower ratio suggests a more conservative approach to financing, with a higher proportion of equity in the capital structure.
It is important for investors and stakeholders to closely monitor the financial leverage ratio of Centerpoint Energy Inc. to assess the company's financial risk and stability. A sustainable level of leverage is essential to support growth and profitability while managing financial risks effectively.
Peer comparison
Dec 31, 2023