Consolidated Communications (CNSL)

Consolidated Communications Holdings Inc's solvency ratios provide insights into the company's ability to meet its long-term financial obligations. Looking at the trend over the past five years, we observe variations in different solvency ratios.

The debt-to-assets ratio has ranged from 0.55 to 0.67, indicating that the company has been able to finance its assets through debt, with the ratio showing a slight increase in 2023 compared to previous years. This suggests that 59% of the company's assets were financed by debt at the end of 2023.

The debt-to-capital ratio has also shown fluctuations, ranging from 0.67 to 0.87, with a decrease in 2023 compared to the prior year. This ratio indicates that debt accounts for 74% of the company's capital structure at the end of 2023.

The debt-to-equity ratio, which reflects the proportion of debt financing compared to equity, has varied significantly from 2.06 to 6.68 over the last five years. In 2023, the ratio increased to 2.79, suggesting that the company had a higher level of debt relative to equity, signifying increased financial risk.

The financial leverage ratio, a measure of the company's overall debt levels compared to its equity, has shown a declining trend from 9.95 in 2019 to 4.70 in 2023. This indicates that the company has reduced its financial leverage over the years, although it remains relatively high.

Overall, while Consolidated Communications Holdings Inc has managed to reduce its financial leverage ratio over the years, indicating improved solvency, the increasing debt-to-equity ratio in 2023 raises some concerns about the company's debt funding and financial stability. Monitoring these solvency ratios will be crucial in assessing the company's ability to meet its long-term financial obligations effectively.

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Coverage ratios

Consolidated Communications Holdings Inc's interest coverage ratio has been fluctuating over the past five years, indicating varying levels of the company's ability to meet its interest obligations from its operating income. The negative interest coverage ratio of -0.38 in 2023 suggests that the company's operating income was insufficient to cover its interest expenses during that period. This is a concern as it indicates financial distress.

In 2022 and 2021, the interest coverage ratios of 0.34 and 0.80 respectively indicate that the company's operating income was only able to cover a fraction of its interest expenses. While there was a slight improvement in 2021 compared to 2022, the ratios are still relatively low, signaling potential difficulties in meeting interest obligations.

The interest coverage ratio improved to 1.00 in 2020, indicating that the company was able to meet its interest expenses with its operating income. However, the ratio of 0.59 in 2019 suggests a decrease in the company's ability to cover its interest expenses compared to 2020.

Overall, the downward trend in interest coverage ratios in recent years raises concerns about Consolidated Communications Holdings Inc's financial health and ability to service its debt obligations. It is important for the company to closely monitor and improve its interest coverage ratio to maintain financial stability and avoid potential liquidity issues.