DTE Energy Company (DTE)

DTE Energy Company's solvency ratios indicate its ability to meet its long-term financial obligations. The Debt-to-assets ratio, which measures the proportion of total assets financed by debt, has shown a slight increase from 0.43 in 2020 to 0.45 in 2024. This indicates that the company's reliance on debt to fund its assets has been increasing over the years.

The Debt-to-capital ratio, which indicates the proportion of capital comprised of debt, has also been on the rise, from 0.61 in 2020 to 0.65 in 2024. This suggests that DTE Energy Company has been progressively financing a larger portion of its operations using debt capital.

The Debt-to-equity ratio, showing the relationship between debt and equity in financing the company, has fluctuated over the years, with an increase from 1.56 in 2020 to 1.88 in 2024. This indicates a growing reliance on debt relative to equity in funding the company's operations.

The Financial leverage ratio, which measures the extent to which the company is utilizing debt to finance its assets, has also seen an upward trend, moving from 3.66 in 2020 to 4.18 in 2024. This indicates an increasing level of financial leverage being employed by DTE Energy Company.

Overall, the trend across these solvency ratios suggests that DTE Energy Company has been gradually increasing its reliance on debt to finance its operations and investments over the years. This may indicate a need for careful monitoring of the company's debt levels and financial risk management strategies to ensure long-term financial stability.

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Coverage ratios

Based on the data provided, the interest coverage ratio of DTE Energy Company has fluctuated over the past five years. In December 31, 2020, the interest coverage ratio was 3.34, indicating that the company generated enough operating income to cover its interest expenses 3.34 times over. However, there was a decrease in this ratio over the following years, with ratios of 2.23 in 2021, 2.65 in 2022, 2.98 in 2023, and 2.44 in 2024.

This downward trend in the interest coverage ratio suggests that DTE Energy Company may be facing challenges in generating sufficient operating income to cover its interest expenses. A decreasing interest coverage ratio could raise concerns among investors and creditors about the company's ability to meet its debt obligations comfortably.

It is essential for DTE Energy Company to closely monitor its interest coverage ratio and take appropriate measures to improve it, such as increasing profitability, reducing debt, or optimizing its capital structure. Maintaining a healthy interest coverage ratio is crucial for demonstrating financial stability and ensuring the company's long-term sustainability.