Marathon Digital Holdings Inc (MARA)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.16 | 0.65 | 0.50 | 0.00 | 0.15 |
| Debt-to-capital ratio | 0.17 | 0.67 | 0.52 | 0.00 | 0.21 |
| Debt-to-equity ratio | 0.20 | 2.03 | 1.07 | 0.00 | 0.27 |
| Financial leverage ratio | 1.23 | 3.10 | 2.12 | 1.00 | 1.81 |
The solvency ratios of Marathon Digital Holdings Inc indicate the company's ability to meet its long-term financial obligations and manage its debt levels effectively over the years analyzed.
The debt-to-assets ratio has shown a declining trend from 0.65 in 2022 to 0.16 in 2023, implying that the company's debt relative to its total assets has decreased significantly, indicating improved solvency and lower financial risk.
Similarly, the debt-to-capital ratio has also decreased from 0.67 in 2022 to 0.17 in 2023, reflecting a stronger capital structure and reduced reliance on debt financing for company operations.
The debt-to-equity ratio has exhibited a significant improvement from 2.03 in 2022 to 0.20 in 2023, suggesting a decrease in financial leverage and a more balanced capital structure where equity plays a more substantial role in financing the company's operations.
The financial leverage ratio, reflecting the extent of a company's financial leverage, has also shown a positive trend by decreasing from 3.10 in 2022 to 1.23 in 2023, indicating a decrease in financial risk and better financial stability.
Overall, the improving solvency ratios of Marathon Digital Holdings Inc suggest a healthier financial position and effective management of debt levels, enhancing the company's capacity to meet its financial obligations and sustain long-term growth.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 27.82 | -46.30 | -8.25 | -496.43 | -81.52 |
The interest coverage ratio for Marathon Digital Holdings Inc has shown significant fluctuations over the past five years. In 2023, the company's interest coverage ratio improved to 27.82, indicating a strong ability to cover interest expenses with operating income. This sharp increase from the previous year's negative ratio of -46.30 reflects a positive trend in the company's financial health.
The negative interest coverage ratios in 2022, 2021, 2020, and 2019 are concerning as they suggest that the company's operating income was insufficient to cover its interest expenses during those years. The most significant decline was in 2020 with a ratio of -496.43, indicating a severe inability to meet interest obligations with operating income.
Although the company's interest coverage has improved in 2023, investors and stakeholders should monitor this ratio closely to ensure that Marathon Digital Holdings Inc can continue to generate enough earnings to comfortably cover its interest payments.