CNX Resources Corp (CNX)

CNX Resources Corp's solvency ratios indicate the company's ability to meet its long-term financial obligations.

1. Debt-to-assets ratio: This ratio measures the proportion of the company's assets financed by debt. CNX Resources Corp's debt-to-assets ratio has been declining steadily from 0.30 in 2020 to 0.22 in 2024, indicating that the company has been reducing its reliance on debt to fund its assets.

2. Debt-to-capital ratio: This ratio shows the percentage of the company's capital structure that is financed by debt. CNX Resources Corp's debt-to-capital ratio has fluctuated over the years, peaking at 0.43 in 2022 before decreasing to 0.31 in 2024. The fluctuations suggest changes in the company's capital structure.

3. Debt-to-equity ratio: The debt-to-equity ratio measures the extent to which a company is financed by debt relative to its equity. CNX Resources Corp's debt-to-equity ratio has shown variability, with a peak of 0.75 in 2022 and decreasing to 0.45 in 2024. The decreasing trend indicates a lower reliance on debt for financing.

4. Financial leverage ratio: This ratio indicates the degree to which the company uses debt in its capital structure. CNX Resources Corp's financial leverage ratio has fluctuated over the years, with the highest ratio recorded in 2022 at 2.89 and decreasing to 2.08 in 2024. The fluctuations suggest changes in the company's debt management strategy.

Overall, the trend in CNX Resources Corp's solvency ratios indicates a decreasing reliance on debt for financing its operations and investments, which can lead to improved financial stability and reduced financial risk in the long term. However, the fluctuations in some ratios point to potential changes in the company's capital structure over the years.

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Coverage ratios

Based on the data provided, CNX Resources Corp's interest coverage ratio has shown significant fluctuation over the years. The interest coverage ratio is a measure of a company's ability to meet its interest obligations on its outstanding debt.

In December 2020 and December 2021, the company's interest coverage ratios were negative, indicating that CNX Resources Corp's earnings were insufficient to cover its interest expenses during those periods. This suggests a potential risk of default on its debt obligations.

In December 2022, the interest coverage ratio deteriorated even further to -0.66, signaling a worsening financial position and heightened concerns about the company's ability to service its debt.

However, by December 2023, there was a notable improvement in CNX Resources Corp's interest coverage ratio, which surged to 16.51. This sharp increase indicates a significant enhancement in the company's ability to cover its interest expenses, reflecting a stronger financial position and improved profitability.

Unfortunately, in December 2024, the interest coverage ratio declined again to -1.49, indicating a setback in the company's ability to cover its interest expenses and suggesting potential financial challenges.

In summary, CNX Resources Corp's interest coverage ratio has been volatile, with periods of financial strain followed by improvements and setbacks. It is crucial for the company to sustainably increase its earnings and manage its debt effectively to ensure its long-term financial stability.