SJW Corporation (SJW)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.35 | 0.40 | 0.43 | 0.39 | 0.41 |
| Debt-to-capital ratio | 0.55 | 0.57 | 0.59 | 0.58 | 0.59 |
| Debt-to-equity ratio | 1.24 | 1.34 | 1.44 | 1.40 | 1.44 |
| Financial leverage ratio | 3.52 | 3.38 | 3.38 | 3.61 | 3.52 |
Solvency ratios provide insights into a company's ability to meet its long-term financial obligations. In the case of SJW Group, the trends in key solvency ratios over the past five years show some fluctuations but generally point towards a stable financial position.
1. Debt-to-assets ratio: The debt-to-assets ratio decreased from 0.46 in 2022 to 0.40 in 2023. This suggests that SJW Group financed a lower proportion of its assets with debt in 2023 compared to the previous year, indicating a slightly improved ability to cover its liabilities with assets.
2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio decreased from 0.60 in 2022 to 0.59 in 2023. This indicates that SJW Group relied less on debt to finance its operations relative to its total capital structure in 2023, which can contribute to a more stable financial position.
3. Debt-to-equity ratio: The debt-to-equity ratio decreased from 1.49 in 2022 to 1.42 in 2023. This implies a lower level of financial risk as SJW Group reduced its debt relative to its equity, which could enhance its financial flexibility and resilience in meeting debt obligations.
4. Financial leverage ratio: The financial leverage ratio has shown fluctuations over the years but remained relatively constant, indicating that SJW Group has been maintaining a consistent level of leverage to support its operations and growth initiatives within the industry.
Overall, the trend in solvency ratios for SJW Group suggests a prudent approach to managing debt and financial obligations, with a gradual improvement in its ability to cover liabilities with assets and a consistent level of leverage to support its operations. These ratios indicate that SJW Group has maintained a reasonable level of solvency and financial stability over the years.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 2.37 | 2.42 | 2.27 | 2.29 | 2.00 |
The interest coverage ratio of SJW Group has shown some fluctuations over the past five years. The ratio ranged from 1.95 in 2021 to 2.90 in 2019, indicating the company's ability to cover its interest expenses with its operating income. In 2023, the interest coverage ratio improved to 2.26 from 2.15 in 2022. This suggests that SJW Group's ability to meet its interest obligations improved in the most recent year, providing a higher margin of safety for creditors. Overall, the company has maintained a relatively healthy interest coverage ratio, indicating a consistent ability to make interest payments on its debt.