Howmet Aerospace Inc (HWM)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 3,500,000 | 4,162,000 | 4,227,000 | 4,699,000 | 4,906,000 |
| Total stockholders’ equity | US$ in thousands | 4,037,000 | 3,601,000 | 3,508,000 | 3,577,000 | 4,591,000 |
| Debt-to-capital ratio | 0.46 | 0.54 | 0.55 | 0.57 | 0.52 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $3,500,000K ÷ ($3,500,000K + $4,037,000K)
= 0.46
The debt-to-capital ratio of Howmet Aerospace Inc has shown a declining trend over the past five years, decreasing from 0.56 in 2019 to 0.48 in 2023. This indicates that the company has been gradually reducing its reliance on debt as a source of capital in relation to its total capital structure.
A lower debt-to-capital ratio suggests that the company may be less leveraged and more financially stable, as it indicates a smaller proportion of debt in relation to total capital. This trend could imply that Howmet Aerospace Inc is managing its debt levels effectively, potentially reducing financial risk and improving its ability to weather economic uncertainties.
Overall, the decreasing debt-to-capital ratio of Howmet Aerospace Inc over the past five years reflects a positive trend in the company's capital structure and financial health.
Peer comparison
Dec 31, 2023