T-Mobile US Inc (TMUS)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.36 | 0.34 | 0.32 | 0.32 | 0.31 |
| Debt-to-capital ratio | 0.55 | 0.52 | 0.49 | 0.49 | 0.49 |
| Debt-to-equity ratio | 1.20 | 1.10 | 0.96 | 0.97 | 0.95 |
| Financial leverage ratio | 3.37 | 3.21 | 3.03 | 2.99 | 3.06 |
T-Mobile US Inc's solvency ratios show a consistent increase in leverage over the period from 2020 to 2024. The Debt-to-assets ratio has risen from 0.31 in 2020 to 0.36 in 2024, indicating a greater proportion of the company's assets being financed by debt. Similarly, the Debt-to-capital ratio has increased from 0.49 in 2020 to 0.55 in 2024, reflecting a higher reliance on debt for funding the company's operations.
The Debt-to-equity ratio has shown a steep rise from 0.95 in 2020 to 1.20 in 2024, suggesting a significant increase in the company's debt relative to its equity. This indicates a higher financial risk and potentially a higher cost of capital for the company.
Furthermore, the Financial leverage ratio, which measures the degree to which a company funds its operations through debt, has increased from 3.06 in 2020 to 3.37 in 2024. This rise shows that T-Mobile US Inc has been increasingly using debt to finance its operations, potentially leading to higher financial risk and interest expenses.
In conclusion, T-Mobile US Inc's solvency ratios indicate a trend towards higher leverage and greater reliance on debt financing over the years, which could impact the company's financial stability and flexibility in the long run.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 529.71 | 77.96 | 50.72 | 1.89 | 2.04 |
Interest coverage is a key financial ratio used to assess a company's ability to meet its interest obligations on outstanding debt. T-Mobile US Inc's interest coverage has shown fluctuations over the years based on the data provided.
As of December 31, 2020, the interest coverage ratio was 2.04, indicating that the company's operating income was just about sufficient to cover its interest expenses. The ratio decreased slightly to 1.89 as of December 31, 2021, suggesting a slight weakening in the company's ability to cover interest payments with its operating income.
However, there was a significant improvement in the interest coverage ratio in subsequent years. By December 31, 2022, the ratio surged to 50.72, indicating a substantial increase in T-Mobile's ability to cover its interest expenses. This trend continued as of December 31, 2023, with the interest coverage ratio reaching 77.96, reflecting a strong ability to meet interest obligations.
The most notable increase was seen as of December 31, 2024, where the interest coverage ratio soared to 529.71. This signifies a remarkable improvement in T-Mobile's financial health and its capacity to comfortably cover its interest payments multiple times over with its operating income.
Overall, the data reveals that T-Mobile US Inc's interest coverage has shown variability in recent years but has demonstrated a significant strengthening trend, indicating a healthier position in managing its interest obligations as time progressed.