Otter Tail Corporation (OTTR)

Debt-to-capital ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Long-term debt US$ in thousands 943,734 824,059 823,821 734,014 624,432
Total stockholders’ equity US$ in thousands 1,668,500 1,443,010 1,217,320 990,777 870,966
Debt-to-capital ratio 0.36 0.36 0.40 0.43 0.42

December 31, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $943,734K ÷ ($943,734K + $1,668,500K)
= 0.36

The debt-to-capital ratio of Otter Tail Corporation has shown a modest decrease over the past five years, starting at 0.42 in December 31, 2020, and gradually declining to 0.36 by December 31, 2024. This indicates that the company's reliance on debt compared to its total capital has decreased slightly over the period. A lower debt-to-capital ratio generally suggests a lower financial risk and a more conservative capital structure. It's a positive trend that can imply improved financial stability and a potentially healthier balance sheet for Otter Tail Corporation. It's important for investors and stakeholders to continue monitoring this ratio to assess the company's financial health and risk management strategies.