Lumen Technologies Inc (LUMN)
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 | 19,703,000 | 20,255,000 | 28,635,000 | — | — |
| Total stockholders’ equity | US$ in thousands | 417,000 | 10,374,000 | 11,840,000 | 11,162,000 | 13,470,000 |
| Debt-to-capital ratio | 0.98 | 0.66 | 0.71 | 0.00 | 0.00 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $19,703,000K ÷ ($19,703,000K + $417,000K)
= 0.98
The debt-to-capital ratio of Lumen Technologies Inc has shown variability over the past five years. The ratio stood at 0.98 at the end of 2023, indicating that the company financed 98% of its capital structure through debt. This represents a significant increase from the previous year when the ratio was 0.66.
Comparing to earlier years, in 2021, the ratio was 0.71, suggesting a lower reliance on debt for capital funding compared to 2023. In 2020 and 2019, the ratios were 0.74 and 0.72, respectively, showing a relatively stable debt-to-capital structure during those years.
The upward trend in the debt-to-capital ratio from 2021 to 2023 signals that Lumen Technologies Inc has been increasingly using debt to finance its operations and investments. This may indicate a higher risk exposure to debt obligations, which could lead to financial challenges in the future if not managed effectively. Overall, a high debt-to-capital ratio can be a cause for concern for investors and creditors due to the potential financial risks associated with high levels of indebtedness.
Peer comparison
Dec 31, 2023