Sempra Energy (SRE)
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 | 0.00 | 0.32 | 0.33 | 0.32 | 0.31 | 0.31 | 0.32 | 0.32 | 0.28 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.49 | 0.50 | 0.48 | 0.47 | 0.47 | 0.47 | 0.48 | 0.44 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.98 | 0.99 | 0.92 | 0.90 | 0.88 | 0.89 | 0.91 | 0.77 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 3.04 | 3.04 | 2.97 | 2.91 | 2.90 | 2.80 | 2.82 | 2.87 | 2.77 | 2.87 | 2.70 | 2.83 | 2.85 | 2.89 | 2.90 | 3.39 | 3.29 | 3.47 | 3.60 | 3.55 |
Solvency ratios are crucial metrics that reflect a company's ability to meet its long-term financial obligations. Let's analyze Sempra's solvency ratios based on the provided data:
1. Debt-to-assets ratio: This ratio measures the proportion of a company's assets financed by debt. Sempra's debt-to-assets ratio has been relatively stable over the past eight quarters, hovering around the range of 0.34 to 0.37. This indicates that, on average, approximately 34% to 37% of Sempra's assets are funded by debt.
2. Debt-to-capital ratio: The debt-to-capital ratio shows the proportion of a company's capital structure that is financed by debt. Sempra's debt-to-capital ratio has also remained fairly consistent, with values ranging from 0.49 to 0.53. This implies that around 49% to 53% of Sempra's capital is derived from debt sources.
3. Debt-to-equity ratio: The debt-to-equity ratio reflects the company's financial leverage and risk exposure. Sempra's debt-to-equity ratio has shown some fluctuations during the past quarters, varying between 0.97 and 1.11. This suggests that Sempra has been reliant on debt financing to a varying extent, with the ratio exceeding 1.0 in some periods, indicating a higher level of debt relative to equity.
4. Financial leverage ratio: The financial leverage ratio measures the extent to which a company utilizes debt in its capital structure. Sempra's financial leverage ratio has displayed a general upward trend over the quarters, indicating an increase in financial leverage from 2.80 to 3.04. This suggests that Sempra has been incrementally relying more on debt financing to support its operations and investments.
Overall, based on the analysis of Sempra's solvency ratios, the company has maintained a moderate level of debt relative to its assets, capital, and equity. However, there has been a gradual increase in financial leverage, indicating a potential shift towards higher reliance on debt financing for its operations. Investors and stakeholders should continue to monitor these ratios to assess Sempra's long-term financial stability and risk profile.
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 | 3.72 | 3.71 | 3.64 | 3.63 | 3.56 | 3.37 | 2.16 | 2.12 | 2.18 | 2.21 | 3.58 | 5.26 | 4.71 | 4.66 | 4.99 | 3.22 | 3.20 | 3.72 | 3.41 | 1.82 |
Based on the data provided, Sempra's interest coverage ratio has remained relatively stable over the past eight quarters, ranging from 3.76 to 4.26. The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt using its operating income. A higher ratio indicates that the company is more capable of covering its interest obligations.
Sempra's interest coverage ratio consistently above 3.0 over the period indicates that the company has a strong ability to meet its interest payments from its operating income. The steady range of 3.76 to 4.26 suggests that Sempra has maintained financial stability and a healthy cash flow to comfortably cover its interest expenses.
Overall, the trend of Sempra's interest coverage ratio indicates that the company has been effectively managing its debt and generating sufficient income to support its interest obligations. Investors and creditors may view this consistent performance positively as it reflects a sound financial position and lower risk of default.