GE Vernova LLC (GEV)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | — |
| Debt-to-capital ratio | 0.00 | 0.00 | — |
| Debt-to-equity ratio | 0.00 | 0.00 | — |
| Financial leverage ratio | 6.22 | 4.18 | — |
Based on the solvency ratios provided for GE Vernova LLC, we can see that the company has maintained a debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio of 0.00 for all three years, indicating that the company has not been utilizing debt as a source of financing in its capital structure. This suggests a conservative approach to capital management and a low level of financial risk associated with debt obligations.
Interestingly, the financial leverage ratio has increased significantly from 4.18 in 2022 to 6.22 in 2023. This implies that the company has increased its reliance on debt in relation to its equity, which may indicate a shift towards a more leveraged capital structure. While the ratio is still relatively low, this trend warrants monitoring to ensure that the company can effectively service its debt obligations and maintain financial stability.
Overall, GE Vernova LLC appears to have a strong solvency position with minimal debt exposure, although the recent increase in the financial leverage ratio signals a potential shift in the company's financing strategy that should be carefully assessed in the context of its overall financial health.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|
| Interest coverage | -6.76 | -11.54 | -2.20 |
The interest coverage ratio measures a company's ability to meet its interest payments on its outstanding debt. A higher interest coverage ratio indicates a greater ability to cover interest expenses with operating income.
GE Vernova LLC's interest coverage ratio has shown a declining trend over the past three years, with values of -6.76 in 2023, -11.54 in 2022, and -2.20 in 2021. These negative values indicate that the company's operating income is not sufficient to cover its interest expenses.
A consistently negative interest coverage ratio suggests that GE Vernova LLC may have difficulty meeting its interest obligations. This may raise concerns about the company's financial health and ability to service its debt. Investors and creditors may view a negative interest coverage ratio as a red flag, signaling potential financial distress and heightened risk.