Caesars Entertainment Corporation (CZR)

Caesars Entertainment Corporation's solvency ratios demonstrate its ability to meet its long-term financial obligations. The Debt-to-assets ratio has seen a slight decrease from 0.39 in 2020 to 0.37 in 2024, indicating that the company's total debt relative to its total assets has remained relatively stable over the years.

The Debt-to-capital ratio has also shown consistency, hovering around 0.74 to 0.77 during the period, suggesting that a significant portion of the company's capital structure is financed by debt.

On the other hand, the Debt-to-equity ratio has fluctuated, peaking at 3.41 in 2022 but subsequently decreasing to 2.89 in 2024. This ratio indicates the proportion of the company's financing that comes from debt versus equity, with a higher ratio suggesting higher financial risk.

The Financial leverage ratio, which reflects the proportion of the company's assets that are financed by debt, has shown fluctuations but generally has remained around 7 to 9 over the years. This indicates that Caesars Entertainment Corporation relies significantly on debt to fund its operations and investments.

Overall, the solvency ratios of Caesars Entertainment Corporation suggest a stable financial position with a moderate level of leverage and debt relative to assets and capital, although there have been some fluctuations in the Debt-to-equity ratio. It is important for the company to continue monitoring and managing its debt levels to maintain a healthy balance between debt and equity financing.

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Coverage ratios

Interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher ratio indicates stronger financial health and less risk of default.

Looking at Caesars Entertainment Corporation's interest coverage from 2020 to 2024, it's concerning to note that the ratio was negative at -0.34 in December 31, 2020, which implies the company did not earn enough income to cover its interest payments. However, there has been a gradual improvement in the following years, with the ratio increasing to 0.44 in December 31, 2021, 0.59 in December 31, 2022, 0.96 in December 31, 2023, and then slightly dropping to 0.92 in December 31, 2024.

While the company's interest coverage has shown some signs of recovery, the ratios are still below 1 for most of the years, indicating Caesars Entertainment Corporation may continue to struggle to meet its interest obligations with its current earnings. Further monitoring of the trend and potential improvements in profitability are necessary to ensure the company's long-term financial sustainability.