Murphy Oil Corporation (MUR)

Murphy Oil Corporation has consistently maintained a strong solvency position over the years based on its solvency ratios. The Debt-to-assets ratio, Debt-to-capital ratio, and Debt-to-equity ratio have all been reported as 0.00 for the years 2020 to 2024. This indicates that the company has not had any long-term debt in relation to its total assets, capital, or equity during those years.

Additionally, the Financial leverage ratio has shown a decreasing trend from 2.42 in 2020 to 1.86 in 2024. This implies that Murphy Oil Corporation has been reducing its reliance on debt financing relative to its equity over the years, which is a positive indicator of financial stability and lower financial risk.

Overall, the consistent low debt ratios and decreasing financial leverage ratio suggest that Murphy Oil Corporation has a solid solvency position and is effectively managing its debt levels to support its operations and financial health.

---

Coverage ratios

Interest coverage is a crucial financial ratio that indicates a company's ability to meet its interest obligations on outstanding debt. For Murphy Oil Corporation, the interest coverage ratio has shown significant fluctuations over the years:

1. As of December 31, 2020, the interest coverage ratio was -7.40. A negative ratio suggests that the company's operating income was insufficient to cover its interest expenses, raising concerns about its financial health and ability to service debt obligations.

2. By December 31, 2021, the interest coverage ratio improved to 1.10, indicating that the company's operating income barely covered its interest expenses. While this improvement is positive, the ratio is still relatively low, signaling potential financial risk.

3. The interest coverage ratio significantly improved to 10.61 by December 31, 2022, showing a strong ability to cover interest payments with operating income. This increase suggests improved financial stability and lower risk of default.

4. As of December 31, 2023, the interest coverage ratio remained healthy at 9.20, indicating continued strong performance in meeting interest obligations.

5. However, by December 31, 2024, the interest coverage ratio dropped to 3.58. While still above 1, this decline may indicate increased financial strain or reduced operating income relative to interest expenses.

Overall, Murphy Oil Corporation's interest coverage ratio has shown fluctuations, with periods of both weakness and strength. Investors and stakeholders should closely monitor this ratio to assess the company's ability to manage its debt and interest expenses effectively.