DT Midstream Inc (DTM)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|
| Total assets | US$ in thousands | 8,982,000 | 8,833,000 | 8,166,000 |
| Total stockholders’ equity | US$ in thousands | 4,139,000 | 4,007,000 | 3,872,000 |
| Financial leverage ratio | 2.17 | 2.20 | 2.11 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $8,982,000K ÷ $4,139,000K
= 2.17
The financial leverage ratio of DT Midstream Inc has shown a fluctuating trend over the past four years, ranging from 2.05 in 2020 to 2.20 in 2022. As of December 31, 2023, the ratio stands at 2.17. This indicates that the company's reliance on debt to finance its operations has slightly decreased compared to the previous year but is still higher than the levels observed in 2020 and 2021.
A financial leverage ratio above 1 suggests that the company is using more debt than equity to finance its assets. A higher ratio indicates higher financial risk due to increased debt obligations, which could potentially lead to financial distress if not managed effectively. Therefore, DT Midstream Inc may need to closely monitor its debt levels and ensure that it can comfortably meet its debt obligations in the future.
Peer comparison
Dec 31, 2023