ConocoPhillips (NYSE:COP)

Debt to Equity Ratio

The debt to equity ratio demonstrated a consistent declining trend from March 2021 through June 2022, decreasing from 0.46 to 0.34. This indicates a reduction in reliance on debt relative to equity during that period. From June 2022 onward, the ratio exhibited minor fluctuations, mostly stabilizing around the 0.35 to 0.38 range, suggesting a phase of relatively steady capital structure leverage.

Debt to Capital Ratio

The debt to capital ratio mirrored the trend observed in the debt to equity ratio. It declined from 0.32 in March 2021 to 0.25 by June 2022, reflecting a diminished proportion of debt in the overall capital base. Subsequently, the ratio experienced slight variations, generally hovering between 0.26 and 0.29, indicating a moderate stabilization in the company's financing mix.

Debt to Assets Ratio

Over the examined period, the debt to assets ratio trended downward from 0.24 in March 2021 to approximately 0.18 by June 2022, pointing to decreased financial leverage in terms of total assets. This ratio then remained relatively constant around the 0.18 to 0.20 range through to the end of the forecast horizon, showing limited volatility in asset-backed debt levels.

Financial Leverage Ratio

The financial leverage ratio hovered near 2.0 in early 2021 before declining to a low of 1.87 by June 2022. Thereafter, the ratio displayed minor oscillations but largely maintained levels between 1.87 and 1.95, signifying steady equity multiples without significant shifts in reliance on borrowed funds to support assets.

Interest Coverage Ratio

This ratio exhibited a pronounced upward trajectory from 1.17 in March 2021 to a peak of 36.07 in December 2022, indicating substantial improvement in the company's ability to meet interest obligations from operating earnings. After this peak, a gradual decline was observed over subsequent quarters, settling within the range of approximately 16.7 to 20.5 by mid to late 2025. Despite this decrease, the interest coverage ratios remained substantially higher than early 2021 levels, reflecting a stronger and more comfortable capacity to cover interest expenses throughout the period.

Total Debt

The total debt displayed a diminishing trend from early 2021 through mid-2023, declining from approximately $20 billion to around $16.4 billion. This reduction indicates active debt repayment or refinancing leading to lower liabilities. However, from late 2023 onwards, there is a noticeable reversal in this trend, with total debt increasing significantly, reaching beyond $23 billion by the third quarter of 2025. This shift suggests increased borrowing or possible strategic financing activities during this later period.

Common Stockholders’ Equity

Common stockholders’ equity showed a generally upward trajectory over the observed periods. Starting at about $43 billion in early 2021, equity rose steadily to nearly $49 billion by the end of 2023, indicating retained earnings growth or equity injections. This upward movement continues into 2024, peaking around $49.8 billion at year-end. A marked increase occurs in 2025, with equity rising sharply to approximately $65 billion by mid-year, reflecting significant capital accumulation or valuation shifts in shareholders’ equity.

Debt to Equity Ratio

The debt to equity ratio decreased gradually from 0.46 in the first quarter of 2021 to a low near 0.34 by mid-2022, consistent with the reduction in total debt relative to equity growth. Through 2023, the ratio fluctuated moderately around 0.35 to 0.40, indicating some variability in leverage but overall balance. From early 2024 to mid-2025, the ratio stabilized near 0.36 to 0.38, suggesting the company maintained a relatively consistent leverage position despite growing equity and fluctuating debt levels.

Overall Financial Position Insights

The early period reflects a deliberate deleveraging strategy with declining debt and increasing equity, contributing to improved financial stability and lower leverage. The later period, particularly in 2024 and 2025, shows increased borrowing alongside substantial equity growth, which may indicate investment in growth initiatives or capital projects funded by both debt and equity. The relatively stable debt to equity ratio during this time implies balanced financial management to maintain leverage within a controlled range. The trends suggest the company is managing capital structure dynamically to support operational and strategic objectives.

The analysis of the quarterly financial data reveals several notable trends regarding the company's leverage and capital structure over the period observed.

Total Debt

The total debt exhibits a fluctuating pattern across the quarters. Initially, total debt shows a general decline from early 2021 through mid-2022, reaching the lowest points around the third and fourth quarters of 2022. However, starting in the first quarter of 2023, total debt slightly increases and remains relatively stable with some fluctuations until the end of 2024. A significant increase is observed from the first quarter of 2025 onwards, where total debt rises sharply, indicating a possible change in financing strategy or increased borrowing.

Total Capital

Total capital shows a modest upward trend through 2021 and most of 2022, peaking in the fourth quarter of 2022. Following this, total capital remains relatively stable but with minor fluctuations through 2023 and into early 2024. A substantial increase in total capital is observed in early 2025, mirroring the increase seen in total debt. Towards the latter part of the period, however, total capital slightly declines but remains elevated compared to earlier years.

Debt to Capital Ratio

The debt to capital ratio consistently decreases from 0.32 in early 2021 to around 0.25 by mid-2022, reflecting a reduction in leverage relative to the company's total capital. From mid-2022 to the end of 2024, the ratio stabilizes around 0.26 to 0.28, indicating a maintained and relatively conservative leverage position. In the early quarters of 2025, despite the sharp increase in total debt and capital, the ratio remains stable around 0.26 to 0.27, suggesting that the increased borrowing was accompanied by a proportional increase in capital.

Overall, the company appears to have reduced its leverage ratio steadily during 2021 and 2022, maintaining disciplined capital management through 2023 and 2024. The noteworthy increase in both debt and capital in early 2025 indicates a strategic shift toward larger scale financing, while sustaining the debt to capital ratio within a controlled range, reflecting a balanced approach to managing financial risk and capital structure.

Total Debt

The total debt demonstrated a general downward trend from March 31, 2021, through June 30, 2024, decreasing from approximately 20,027 million USD to around 18,352 million USD. However, beginning from December 31, 2024, total debt increased markedly, reaching a peak of 24,324 million USD by March 31, 2025. This indicates a significant shift in leverage strategy or financing requirements in the most recent periods analyzed.

Total Assets

Total assets steadily increased from 83,693 million USD as of March 31, 2021, to about 96,699 million USD by December 31, 2024, indicating a period of asset growth and possibly investment or acquisition activities. However, from December 31, 2024, to March 31, 2025, total assets surged significantly to approximately 122,780 million USD, maintaining elevated levels thereafter. This substantial asset growth suggests a major expansion event or asset revaluation during the last quarters.

Debt to Assets Ratio

The debt to assets ratio showed a declining trend from 0.24 at the start of the period to a low around 0.18 through much of 2022 and early 2023, reflecting a reduction in leverage relative to asset base. From late 2023 onwards, the ratio stabilized around 0.19 to 0.20, despite the substantial increase in total assets and debt in 2024 and early 2025. This stability indicates that the growth in debt was accompanied by proportional asset increases, maintaining a relatively consistent leverage profile in the recent periods.

Overall Analysis

The financial data reveals a phase of deleveraging and asset accumulation during 2021 to early 2024, followed by a period of significant expansion in both debt and assets toward the end of the timeline. Despite increased debt in 2024-2025, leverage remained stable relative to asset size, suggesting controlled use of debt to finance growth. These patterns point to strategic financial management balancing growth initiatives with risk considerations related to debt levels.

The analysis of the quarterly financial data reveals the following trends and insights.

Total Assets

Total assets showed a general upward trend from March 2021 to December 2024, rising from approximately $83.7 billion to nearly $97.0 billion. There was a noticeable jump in the final quarters, with total assets increasing sharply to around $122.8 billion by December 2024. This significant increase reflects considerable asset growth towards the end of the period. Some fluctuations are observed along the way, with a slight drop in total assets in early 2023, followed by recovery later in the year and into 2024.

Common Stockholders’ Equity

Common stockholders’ equity increased steadily from $43.2 billion in March 2021 to $49.9 billion by December 2024, indicating gradual growth in the company’s equity base over the period. Like total assets, there is a marked rise towards the end of 2024, where equity jumps to approximately $64.8 billion by December 2024. Some minor declines occur in late 2021 and 2022, but these are relatively small and followed by recovery.

Financial Leverage

Financial leverage remained relatively stable throughout the observed quarters, fluctuating in a narrow range between approximately 1.87 and 2.00. The ratio generally hovers close to 1.9, indicating that the company maintained a consistent level of leverage over the period without significant increases or decreases in its debt-to-equity structure. There is a slight downward trend towards the end of the dataset, with leverage decreasing from about 1.95 in late 2023 to around 1.89 by September 2025.

Overall, the company shows growth in total assets and stockholders’ equity, particularly pronounced in the latter part of the timeline, while maintaining steady financial leverage. This suggests an expansion phase supported by a balanced approach to debt and equity financing.

Earnings before interest and tax (EBIT)

The EBIT demonstrated a strong upward trend from early 2021 through early 2022, peaking at 8115 million USD in March 2022. Subsequently, there was a gradual decline in EBIT values throughout the remainder of 2022 and into 2023, reaching a lower level around 3161 million USD in December 2024. However, a notable recovery occurred starting in early 2025, with EBIT rising again to 4671 million USD by March 2025, before decreasing somewhat in the following quarters. This pattern indicates volatility with a peak during early 2022 and varied performance afterward.

Interest and debt expense

Interest and debt expenses remained relatively stable over the entire period, fluctuating within a narrow range between approximately 178 million USD and 232 million USD. There is a slight tendency towards increase in some of the later quarters, notably reaching 232 million USD in June 2025. The overall stability in interest expenses contrasts with the more significant fluctuations seen in EBIT.

Interest coverage ratio

The interest coverage ratio showed significant improvement from the value of 1.17 in March 2021 to a peak near 36 in December 2021, reflecting increasing EBIT relative to stable interest expenses. Following this peak, the ratio gradually declined through 2023 and into 2025, indicating a reduction in the safety margin to cover interest obligations despite EBIT fluctuations. Despite the decline, the ratio remained strong, staying above 16 in all observed quarters after the peak. This suggests the company maintained a favorable ability to meet interest payments over the period examined, albeit with some weakening from the peak coverage levels achieved in late 2021.