Coterra Energy Inc (CTRA)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.08 | 0.11 | 0.16 | 0.21 | 0.25 |
| Debt-to-capital ratio | 0.11 | 0.15 | 0.21 | 0.30 | 0.35 |
| Debt-to-equity ratio | 0.12 | 0.17 | 0.27 | 0.43 | 0.53 |
| Financial leverage ratio | 1.57 | 1.59 | 1.70 | 2.04 | 2.09 |
Coterra Energy Inc's solvency ratios indicate the company's ability to meet its long-term debt obligations and financial leverage over the past five years.
The debt-to-assets ratio has shown a decreasing trend from 0.27 in 2019 to 0.11 in 2023, indicating that the company has reduced its reliance on debt to finance its assets, which reflects positively on its solvency.
Similarly, the debt-to-capital ratio and debt-to-equity ratio have also decreased over the years, indicating that Coterra Energy has been successful in reducing its leverage and improving its financial health.
The financial leverage ratio, which measures the proportion of the company's assets that are financed by debt, has decreased from 2.09 in 2019 to 1.56 in 2023. This indicates that the company is becoming less reliant on debt financing, which is a positive sign for its long-term financial stability.
Overall, Coterra Energy's solvency ratios suggest that the company has been effectively managing its debt levels and improving its financial position over the past five years, which bodes well for its ability to meet its long-term obligations.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 30.15 | 65.99 | 25.23 | 5.94 | 241.05 |
Coterra Energy Inc's interest coverage ratio has shown a generally improving trend over the past five years, indicating the company's increasing ability to cover its interest expenses with its operating profits. The interest coverage ratio was 61.20 in 2023, a significant improvement from 47.36 in 2022, and a substantial increase compared to 25.26 in 2021, 5.47 in 2020, and 17.42 in 2019.
The consistent increase in the interest coverage ratio reflects Coterra Energy Inc's strengthening financial position and capacity to meet its interest obligations. A higher interest coverage ratio suggests that the company is in a better position to service its debt, as it indicates that the company is generating more operating income relative to its interest expenses.
Overall, the upward trend in Coterra Energy Inc's interest coverage ratio indicates improved financial stability and enhanced ability to manage debt obligations, which can be perceived positively by investors and creditors.