Southwest Gas Holdings Inc (SWX)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 3.43 | 3.59 | 4.31 | 4.32 | 3.27 |
Based on the provided data, Southwest Gas Holdings Inc demonstrates excellent solvency ratios across the board. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio have consistently been at 0.00 from December 31, 2020, to December 31, 2024. This indicates that the company has minimal debt in relation to its assets, capital, and equity, which is a positive sign of financial health and stability.
Furthermore, the financial leverage ratio, which measures the extent of a company's financial leverage, has ranged between 3.27 to 4.32 over the same period. A decreasing trend in this ratio suggests that the company is relying less on debt financing to support its operations, which can reduce financial risk and enhance solvency.
Overall, Southwest Gas Holdings Inc's solvency ratios indicate a strong financial position with a conservative debt structure, suggesting that the company is managing its financial obligations effectively and can withstand economic downturns or unexpected challenges.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 1.81 | 1.68 | -0.13 | 2.98 | 3.61 |
Southwest Gas Holdings Inc's interest coverage ratio has shown some fluctuation over the years. It decreased from 3.61 in 2020 to 2.98 in 2021, indicating a slight decrease in the company's ability to cover its interest expenses with its operating income. However, there was a significant drop in the interest coverage ratio to -0.13 in 2022, which suggests that the company's operating income was insufficient to cover its interest expenses during that period, raising concerns about its financial health.
The interest coverage ratio improved in the following years, reaching 1.68 in 2023 and 1.81 in 2024. While the ratios are still below ideal levels, they indicate a slight recovery in the company's ability to cover its interest expenses. It is important for Southwest Gas Holdings Inc to closely monitor and manage its interest coverage ratio to ensure it remains at a sustainable level and to address any underlying issues that may be impacting its financial performance.