Williams Companies Inc (WMB)

The solvency ratios of Williams Companies Inc indicate a generally stable financial position over the last five years. The debt-to-assets ratio has been decreasing gradually from 0.61 in 2020 to 0.47 in 2024, suggesting that the company's reliance on debt to finance its assets has decreased, which is a positive sign for long-term solvency.

Similarly, the debt-to-capital ratio has shown a slight fluctuation but has remained relatively consistent around 0.70 to 0.68 during the period, indicating that the company has been able to manage its debt levels in relation to its capital structure.

The debt-to-equity ratio has also displayed a relatively stable trend, hovering between 1.96 and 2.43 over the years. While this ratio indicates that the company relies more on debt financing than equity, the consistency in the ratio implies a balanced approach to capital structure management.

The financial leverage ratio, which measures the company's overall debt levels in relation to its equity, has shown a slight upward trend from 3.75 in 2020 to 4.39 in 2024. This suggests that the company has been gradually increasing its leverage, which could potentially lead to higher financial risk if not managed effectively.

Overall, while the solvency ratios show some fluctuations, Williams Companies Inc appears to have maintained a reasonable level of solvency and financial stability during the period under review. However, the company should continue to monitor its debt levels and leverage to ensure long-term sustainability and growth.

---

Coverage ratios

The interest coverage ratio for Williams Companies Inc has been improving steadily over the past five years, reflecting the company's ability to meet its interest obligations with its operating income. The ratio was 1.25 as of December 31, 2020, indicating that the company's operating income could cover its interest expenses 1.25 times over.

By December 31, 2021, the interest coverage ratio had increased to 2.72, demonstrating a stronger ability to meet interest payments. This positive trend continued in the subsequent years with the interest coverage ratios reaching 3.16 as of December 31, 2022, and 4.39 as of December 31, 2023, indicating a gradual improvement in the company's financial health.

The most significant leap in the interest coverage ratio was seen by December 31, 2024, where the ratio surged to an impressive 49.10. This substantial increase signifies a substantial increase in Williams Companies' capacity to cover its interest expenses comfortably with its operating income.

Overall, the consistent improvement in Williams Companies Inc's interest coverage ratio over the five-year period suggests a strengthening financial position and indicates the company's ability to easily meet its interest obligations.