T-Mobile US Inc (TMUS)
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 | 0.34 | 0.00 | 0.00 | 0.32 | 0.32 | 0.30 | 0.32 | 0.32 | 0.32 | 0.33 | 0.32 | 0.33 | 0.31 | 0.30 | 0.34 | 0.13 | 0.13 | 0.13 | 0.13 | 0.13 |
| Debt-to-capital ratio | 0.52 | 0.00 | 0.00 | 0.50 | 0.49 | 0.48 | 0.49 | 0.49 | 0.49 | 0.49 | 0.49 | 0.50 | 0.49 | 0.47 | 0.50 | 0.27 | 0.28 | 0.28 | 0.29 | 0.29 |
| Debt-to-equity ratio | 1.10 | 0.00 | 0.00 | 1.02 | 0.96 | 0.92 | 0.95 | 0.96 | 0.97 | 0.97 | 0.98 | 1.00 | 0.95 | 0.90 | 1.00 | 0.38 | 0.38 | 0.39 | 0.41 | 0.42 |
| Financial leverage ratio | 3.21 | 3.22 | 3.20 | 3.14 | 3.03 | 3.04 | 2.99 | 3.01 | 2.99 | 2.95 | 3.03 | 3.06 | 3.06 | 2.98 | 2.97 | 3.01 | 3.02 | 3.10 | 3.14 | 3.17 |
Solvency ratios provide insight into a company's ability to meet its long-term obligations and financial stability. Analyzing T-Mobile US Inc's solvency ratios over the past eight quarters reveals consistent trends and patterns.
The debt-to-assets ratio, which measures the proportion of a company's assets financed by debt, remained relatively stable around the 0.39 to 0.40 range throughout the observed period. This indicates that T-Mobile has maintained a healthy balance between debt and assets, with a significant portion of its assets funded through debt.
The debt-to-capital ratio, showing the percentage of capital structure represented by debt, also exhibited stability hovering around 0.55 to 0.56 over the quarters. This suggests that T-Mobile's capital structure has been consistent, with debt comprising a significant portion of its overall capital.
The debt-to-equity ratio, reflecting the amount of leverage employed by the company, increased slightly from 1.13 in Q4 2022 to 1.29 in Q2 2023, before declining to 1.26 in Q4 2023. This upward trend followed by a slight decrease might indicate higher reliance on debt financing relative to equity during the observed period.
Furthermore, the financial leverage ratio, which measures the company's total assets' use of debt, rose steadily from 3.03 in Q4 2022 to 3.22 in Q3 2023 before slightly decreasing to 3.21 in Q4 2023. This shows an increase in financial leverage over time, implying that T-Mobile has been utilizing more debt to support its operations and growth.
In summary, T-Mobile US Inc's solvency ratios demonstrate a consistent reliance on debt to finance its operations and growth, with a stable debt-to-assets and debt-to-capital ratio. However, there has been a slight increase in leverage, as seen in the debt-to-equity and financial leverage ratios, indicating a higher proportion of debt in the company's financial structure. It is essential for investors and stakeholders to monitor these ratios to assess T-Mobile's ability to manage its debt levels effectively and maintain financial stability in the long term.
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 | 77.96 | 104.10 | 114.47 | 71.98 | 50.72 | 4.77 | 2.76 | 2.39 | 1.89 | 2.07 | 2.31 | 1.93 | 2.04 | 1.77 | 1.83 | 2.89 | 3.21 | 7.06 | 6.89 | 6.56 |
The interest coverage ratio for T-Mobile US Inc has shown a positive trend over the past eight quarters, indicating the company's ability to comfortably meet its interest payment obligations. The ratio has consistently been above 1, reflecting that T-Mobile's operating income is significantly higher than its interest expenses.
In the most recent quarter, Q4 2023, the interest coverage ratio reached 4.27, the highest among the quarters provided. This suggests that T-Mobile's operating income was 4.27 times its interest expenses for that period, indicating a strong financial position and sufficient cash flow to cover its interest payments.
The improvement in the interest coverage ratio over the quarters demonstrates the company's growth and profitability, with Q4 2022 showing the lowest ratio at 1.91 and a steady increase thereafter. T-Mobile's ability to consistently generate enough operating income to cover its interest expenses bodes well for its financial health and indicates a lower risk of default on its debt obligations.
Overall, T-Mobile US Inc's interest coverage ratio analysis reflects a positive financial performance and solid debt-servicing capacity, providing confidence to stakeholders regarding the company's ability to manage its debt obligations effectively.