PNM Resources Inc (PNM)

Solvency ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Debt-to-assets ratio	0.41	0.39	0.41	0.39	0.42	0.43	0.40	0.41	0.41	0.41	0.39	0.28	0.34	0.32	0.32	0.33	0.34	0.34	0.38	0.38
Debt-to-capital ratio	0.64	0.64	0.63	0.62	0.64	0.64	0.63	0.63	0.62	0.61	0.60	0.52	0.57	0.59	0.59	0.60	0.60	0.60	0.62	0.62
Debt-to-equity ratio	1.81	1.75	1.74	1.66	1.78	1.77	1.68	1.71	1.62	1.58	1.53	1.09	1.33	1.42	1.44	1.52	1.50	1.48	1.66	1.65
Financial leverage ratio	4.36	4.50	4.26	4.23	4.22	4.10	4.18	4.13	4.00	3.85	3.89	3.91	3.87	4.37	4.46	4.53	4.35	4.31	4.37	4.30

The solvency ratios of PNM Resources Inc provide insights into its ability to meet its long-term financial obligations. The debt-to-assets ratio, which measures the proportion of total assets financed by debt, has remained fairly stable around the 0.47 to 0.49 range over the past eight quarters. This indicates that around 47% to 49% of the company's assets are funded by debt.

The debt-to-capital ratio, which indicates the percentage of a company's capital that is contributed by debt, has also shown consistent levels, hovering between 0.65 and 0.68. This suggests that approximately 65% to 68% of PNM Resources Inc's capital structure is composed of debt.

The debt-to-equity ratio reveals the extent to which a company is leveraged through debt relative to its equity. PNM Resources Inc's debt-to-equity ratio has exhibited a slight increase from 1.83 in Q1 2022 to 2.03 in Q4 2023. This suggests that the company has become more reliant on debt financing compared to equity financing over the specified period.

The financial leverage ratio, which provides a broader view of a company's debt levels in relation to its total capitalization, has fluctuated between 4.08 and 4.47. This indicates that PNM Resources Inc's financial risk has varied slightly, with the company being leveraged about 4.10 to 4.47 times on average over the past eight quarters.

Overall, while PNM Resources Inc's solvency ratios have displayed some fluctuations, the company appears to maintain a moderate level of leverage and has generally managed to sustain its ability to meet its long-term financial obligations.

Coverage ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Interest coverage	1.22	1.92	2.70	2.98	3.08	3.31	3.37	3.43	3.18	3.13	3.10	3.07	2.69	2.84	2.61	1.13	1.43	0.57	0.47	1.78

Based on the data provided, the interest coverage ratio of PNM Resources Inc has been fluctuating over the past eight quarters. The trend shows a general decrease in interest coverage ratio from 4.09 in Q1 2022 to 1.80 in Q4 2023.

Having an interest coverage ratio above 1 indicates that the company is generating enough operating income to cover its interest expenses. A higher ratio suggests stronger financial health and ability to easily cover interest payments. However, the declining trend in PNM Resources Inc's interest coverage ratio may raise concerns about its ability to cover interest expenses in the future, especially if the trend continues.

It is important for investors and stakeholders to closely monitor this ratio as it provides insights into the company's financial stability and ability to meet its debt obligations. Further analysis of the factors affecting the declining trend in the interest coverage ratio would be crucial for a more in-depth understanding of PNM Resources Inc's financial position.