Chevron Corp (CVX)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 1.64 | 1.63 | 1.34 | 1.43 | 1.48 |
Chevron Corp has consistently maintained a strong solvency position based on the solvency ratios provided.
1. Debt-to-assets ratio: The company's debt-to-assets ratio has been consistently at 0.00 over the years from 2020 to 2024. This indicates that Chevron has no debt relative to its total assets, suggesting a low financial risk in terms of its ability to meet its obligations.
2. Debt-to-capital ratio: Similar to the debt-to-assets ratio, the debt-to-capital ratio also stands at 0.00 across the years stated. This implies that Chevron's capital structure is not significantly reliant on debt, indicating financial stability and flexibility.
3. Debt-to-equity ratio: Chevron's debt-to-equity ratio remains at 0.00 throughout the period. This ratio indicates the proportion of debt financing compared to equity financing, and a ratio of 0.00 suggests that the company's debt levels are negligible in comparison to its equity, highlighting a strong financial position.
4. Financial leverage ratio: The financial leverage ratio has shown slight fluctuations over the years, ranging from 1.34 to 1.64. Although this ratio has increased slightly in 2023 and 2024 compared to the earlier years, the ratios are still relatively low overall. The increase may indicate higher reliance on debt to finance operations, but generally, the ratio remains at moderate levels, suggesting manageable financial risk and stability.
Overall, based on these solvency ratios, Chevron Corp appears to have a solid financial foundation with low debt levels relative to its assets, capital, and equity. The company's financial leverage is within reasonable limits, indicating effective management of leverage to support its operations and growth.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 47.31 | 60.36 | 97.27 | 32.67 | -8.89 |
Chevron Corp's interest coverage ratio has shown significant variability over the past five years. The interest coverage ratio was negative at -8.89 on December 31, 2020, indicating that the company's operating profits were insufficient to cover its interest expenses. However, there was a substantial improvement in the interest coverage ratio over the following years, reaching 32.67 on December 31, 2021, 97.27 on December 31, 2022, 60.36 on December 31, 2023, and 47.31 on December 31, 2024.
The steep improvement in the interest coverage ratio from negative to positive values indicates that Chevron's ability to meet its interest obligations has significantly strengthened over the years. The company has shown better profitability relative to its interest expenses, suggesting a lower risk of defaulting on its debt obligations. Overall, the trend in Chevron's interest coverage ratio reflects a positive trajectory in its financial health and ability to manage its debt obligations effectively.