Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
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- Cash Flow Statement
- Common-Size Income Statement
- Analysis of Profitability Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Selected Financial Data since 2005
- Operating Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Price to Sales (P/S) since 2005
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Solvency Ratios (Summary)
EQT Corp., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
- Debt to Equity Ratio
- The debt to equity ratio demonstrated moderate fluctuations over the observed periods. Beginning at 0.45 in the first quarter of 2019, it experienced a gradual rise, peaking at 0.75 in the third quarter of 2021. Following this peak, the ratio declined, finishing at 0.50 in the third quarter of 2022. This pattern indicates periods of increased leverage followed by deleveraging efforts.
- Debt to Capital Ratio
- This ratio showed a stable to slightly increasing trend from early 2019 through mid-2021, rising from 0.31 to a high of 0.43. After mid-2021, the ratio decreased, ending at 0.33 near the end of the data set. The movement suggests the company adjusted its capital structure, managing its debt proportion relative to total capital carefully.
- Debt to Assets Ratio
- The debt to assets ratio remained relatively stable across the entire timeline. It started at 0.25 and displayed slight variations, peaking at 0.28 at the end of 2019 and gradually decreasing thereafter to reach 0.21 in the third quarter of 2022. This trend points to a modest reduction in asset-backed debt over time.
- Financial Leverage
- Financial leverage increased steadily from 1.83 in the first quarter of 2019 to a notable high of 2.79 in the third quarter of 2021. This increase reflects growing use of debt relative to equity. Subsequently, leverage declined but remained elevated, around 2.34 by the third quarter of 2022 compared to earlier periods, indicating sustained reliance on debt financing.
- Interest Coverage Ratio
- The interest coverage ratio exhibited significant volatility and predominantly negative values, indicating challenges in covering interest expenses through operating earnings. The ratio declined sharply through 2019 and 2020, reaching lows below -10, signifying weak earnings relative to interest obligations. Although some recovery was observed, fluctuations persisted, with a notable positive jump to 10.08 in the third quarter of 2022. This improvement suggests a substantial enhancement in operational profitability or reduced interest charges in the latest period.
Debt Ratios
Coverage Ratios
Debt to Equity
EQT Corp., debt to equity calculation (quarterly data)
| 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||
| Current portion of debt | ||||||||||||||||||||
| Credit facility borrowings | ||||||||||||||||||||
| Term loan facility borrowings | ||||||||||||||||||||
| Senior notes | ||||||||||||||||||||
| Note payable to EQM Midstream Partners, LP | ||||||||||||||||||||
| Total debt | ||||||||||||||||||||
| Common shareholders’ equity | ||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||
| Debt to equity1 | ||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2022 Calculation
Debt to equity = Total debt ÷ Common shareholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends in the company's capital structure over the examined periods.
- Total Debt
- The total debt fluctuated over the observed quarters, starting at approximately 5.05 billion US dollars in March 2019. There was a general decline reaching a low near 4.62 billion in June 2020, followed by an upward trend that peaked at approximately 6.19 billion in September 2021. Subsequent quarters showed a steady reduction, ending at about 4.77 billion in September 2022. This pattern indicates variability in debt levels with a significant increase during mid-2021 before a tapering off towards late 2022.
- Common Shareholders’ Equity
- Common shareholders’ equity demonstrated a downward trend from March 2019's approximate value of 11.14 billion US dollars to below 9 billion by December 2019. It experienced further decreases reaching a low near 8.25 billion in June 2021, followed by a recovery to about 10.03 billion in December 2021. The equity dipped again in early 2022 but showed a resurgence by September 2022, reaching approximately 9.62 billion. Overall, equity exhibited volatility with periods of decline interspersed by recovery phases, highlighting fluctuating retained earnings or market valuation changes.
- Debt to Equity Ratio
- The debt to equity ratio started at 0.45 in March 2019 and remained relatively stable with minor fluctuations until the end of 2019 where it increased to 0.54. It then decreased to 0.49 by June 2020, followed by a rising trend reaching the highest point of 0.75 in September 2021. After this peak, the ratio declined sharply to 0.55 at the end of 2021 and further decreased to 0.50 by September 2022. These changes suggest variations in leverage, with increased reliance on debt financing through 2021 before deleveraging actions in 2022.
In summary, the company experienced significant movements in both debt and equity levels, with a marked increase in leverage peaking in late 2021. The subsequent reduction in both total debt and the debt to equity ratio in 2022 may reflect strategic efforts to strengthen the equity base or reduce financial risk. The fluctuations in shareholders’ equity further emphasize the dynamic financial environment the company faced during this period.
Debt to Capital
EQT Corp., debt to capital calculation (quarterly data)
| 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||
| Current portion of debt | ||||||||||||||||||||
| Credit facility borrowings | ||||||||||||||||||||
| Term loan facility borrowings | ||||||||||||||||||||
| Senior notes | ||||||||||||||||||||
| Note payable to EQM Midstream Partners, LP | ||||||||||||||||||||
| Total debt | ||||||||||||||||||||
| Common shareholders’ equity | ||||||||||||||||||||
| Total capital | ||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||
| Debt to capital1 | ||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2022 Calculation
Debt to capital = Total debt ÷ Total capital
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals notable fluctuations in the company's debt management and capital structure over the observed periods.
- Total Debt
- The total debt exhibited moderate variability throughout the periods. Beginning at approximately $5.05 billion in March 2019, it showed a slight overall decline through mid-2020, reaching a low near $4.62 billion in June 2020. Subsequently, debt levels increased during the latter half of 2020 and into 2021, peaking at around $6.19 billion in September 2021. After this peak, debt declined steadily, reaching roughly $4.77 billion by September 2022. This pattern indicates periods of increased borrowing and subsequent deleveraging.
- Total Capital
- Total capital similarly experienced fluctuations. Starting at about $16.19 billion in March 2019, it decreased to approximately $14.07 billion by June 2020. There was some recovery and growth towards the end of 2020 and throughout 2021, with capital rising to about $15.51 billion in December 2021. However, capital declined again in early 2022 before increasing to nearly $14.39 billion by September 2022. These trends suggest varying levels of equity and debt financing influencing the broader capital base.
- Debt to Capital Ratio
- The debt to capital ratio demonstrated relative stability with some periods of increase and decrease. Initially stable around 0.31 to 0.32 through 2019, it rose to a peak of 0.43 in September 2021, aligning with the highest debt levels observed. After this peak, the ratio decreased to 0.33 by September 2022, indicating a reduction in leverage relative to total capital. The ratio's variability reflects changes in both debt and capital balances, with leverage increasing significantly in late 2020 and 2021 before normalizing.
In summary, the company managed its financing mix dynamically over the periods, with cycles of increased debt issuance followed by reduction. Capital levels showed some volatility, influencing leverage ratios which peaked in late 2021 but were subsequently reduced by the end of the latest reporting period. This behavior may reflect strategic financial decisions responding to market conditions or operational needs during the examined timeframe.
Debt to Assets
EQT Corp., debt to assets calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||
| Current portion of debt | ||||||||||||||||||||
| Credit facility borrowings | ||||||||||||||||||||
| Term loan facility borrowings | ||||||||||||||||||||
| Senior notes | ||||||||||||||||||||
| Note payable to EQM Midstream Partners, LP | ||||||||||||||||||||
| Total debt | ||||||||||||||||||||
| Total assets | ||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||
| Debt to assets1 | ||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2022 Calculation
Debt to assets = Total debt ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
- Total Debt
- The total debt exhibits some variability over the analyzed periods. From March 2019 to December 2019, total debt increased moderately from approximately 5.05 billion to 5.29 billion US dollars. A decline followed from March 2020 through June 2020, reaching approximately 4.62 billion US dollars, likely indicating some deleveraging. However, debt levels rose again towards the end of 2021, peaking near 6.19 billion US dollars in September 2021, before gradually declining to approximately 4.77 billion US dollars by September 2022. Overall, total debt appears to fluctuate within a range of about 4.6 billion to 6.2 billion US dollars, without a consistent upward or downward long-term trend.
- Total Assets
- Total assets demonstrated a generally decreasing trend from March 2019 (around 20.3 billion US dollars) to December 2019 (about 18.8 billion US dollars). This decline continued into mid-2020, hitting a low near 17.6 billion US dollars by September 2020. Subsequently, total assets began to recover, with notable growth through 2021, reaching a peak of approximately 23 billion US dollars in September 2021. After this peak, total assets slightly decreased but remained elevated above 21.5 billion US dollars through mid to late 2022. This pattern suggests initial asset base contraction followed by strong asset growth and a relatively stable elevated asset base thereafter.
- Debt to Assets Ratio
- The debt to assets ratio ranged from 0.22 to 0.29 during the period under analysis. Initially, it was around 0.25 in early 2019 and increased slightly to 0.28 by the end of that year, reflecting a rise in leverage relative to assets. Through 2020 and into early 2021, the ratio hovered around 0.26 to 0.29, indicating moderate leverage stability despite fluctuations in absolute debt and asset values. In the latter part of the period, particularly from March 2021 to September 2022, the ratio declined steadily from approximately 0.27 to 0.21. This decline is consistent with the observed trend of decreasing total debt coupled with relatively stable or growing asset levels, signifying an improvement in the capital structure characterized by reduced leverage.
- Summary Insights
- Overall, the data reflects a cyclical pattern of debt and asset fluctuations with a notable reduction in leverage in the most recent quarters analyzed. The initial phase shows some increase in leverage due to falling assets and relatively steady debt. Subsequently, asset growth combined with debt reduction has improved the debt to assets ratio, indicating a stronger balance sheet posture into 2022. These dynamics suggest active management of capital structure in response to changing asset levels, potentially indicating strategic positioning to reduce financial risk over the observed timeframe.
Financial Leverage
EQT Corp., financial leverage calculation (quarterly data)
| 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||
| Total assets | ||||||||||||||||||||
| Common shareholders’ equity | ||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||
| Financial leverage1 | ||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2022 Calculation
Financial leverage = Total assets ÷ Common shareholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The financial data indicate several noteworthy trends in the company's asset base, equity position, and financial leverage over the examined periods.
- Total Assets
- The total assets demonstrate a general downward trend from early 2019 through late 2020, decreasing from approximately $20.34 billion to $18.11 billion. Following this period, a recovery phase is observed, with assets increasing notably into 2021, peaking around $23.01 billion in September 2021, before slightly declining and stabilizing near $22.54 billion by the third quarter of 2022.
- Common Shareholders’ Equity
- Common shareholders’ equity exhibits a decreasing pattern throughout 2019 into early 2020, dropping from $11.14 billion to roughly $8.85 billion by the third quarter of 2020. During 2021, the equity fluctuates with a significant drop in the first half but recovers sharply by the end of 2021, reaching over $10 billion in December 2021. Subsequently, equity declines again in early 2022 but shows signs of a rebound in the subsequent quarters, though it remains below the high observed in late 2021.
- Financial Leverage
- Financial leverage steadily increases from 1.83 in the first quarter of 2019 to a peak of 2.79 in the third quarter of 2021, indicating rising use of debt relative to equity during this time. Post this peak, leverage decreases to around 2.15 by year-end 2021, then escalates again in early 2022 before gradually declining to approximately 2.34 by the third quarter of 2022.
Overall, the data suggest that the company experienced a contraction phase in both assets and equity through 2019 and 2020, followed by a recovery period marked by asset growth and fluctuating equity levels, accompanied by increased financial leverage. The elevated leverage ratios in 2021 imply a higher reliance on debt financing during the asset growth phase, with subsequent efforts toward deleveraging or capital structure adjustment in 2022. These dynamics may reflect strategic financial management in response to external market conditions or internal investment decisions.
Interest Coverage
EQT Corp., interest coverage calculation (quarterly data)
| Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||
| Net income (loss) attributable to EQT Corporation | ||||||||||||||||||||
| Add: Net income attributable to noncontrolling interest | ||||||||||||||||||||
| Less: Income from discontinued operations, net of tax | ||||||||||||||||||||
| Add: Income tax expense | ||||||||||||||||||||
| Add: Interest expense | ||||||||||||||||||||
| Earnings before interest and tax (EBIT) | ||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||
| Interest coverage1 | ||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2022 Calculation
Interest coverage
= (EBITQ3 2022
+ EBITQ2 2022
+ EBITQ1 2022
+ EBITQ4 2021)
÷ (Interest expenseQ3 2022
+ Interest expenseQ2 2022
+ Interest expenseQ1 2022
+ Interest expenseQ4 2021)
= ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals significant volatility in the company's operating performance as measured by earnings before interest and tax (EBIT) and a fluctuating interest coverage ratio over the observed periods.
- EBIT Trends
-
EBIT demonstrates a highly variable pattern with a mix of both negative and positive values, indicating inconsistent profitability across quarters. The initial quarters of 2019 show positive EBIT, ranging from approximately 215 million to 285 million USD. However, starting from the third quarter of 2019, EBIT sharply declines into negative territory, reaching a notable low of around -1.5 billion USD by the end of 2019.
The negative trend continues through much of 2020, with EBIT remaining below zero, though there is a partial recovery in the fourth quarter of 2020 with a positive EBIT of approximately 135 million USD. In 2021, EBIT fluctuates significantly, with large negative values in the middle of the year followed by a substantial positive spike exceeding 2.4 billion USD at the end of 2021, suggesting atypical or exceptional items impacting profitability.
In 2022, EBIT again swings between negative and positive values, ending with a positive 900 million USD in the final observed quarter. Overall, EBIT's volatility highlights operational instability or the impact of non-operating factors affecting earnings.
- Interest Expense Analysis
-
Interest expense shows a relatively steady and gradual increase over the timeframe. Starting at approximately 56.5 million USD in the first quarter of 2019, it rises incrementally, peaking near 80 million USD in the latter quarters of 2021. Following this, there is a slight decline to around 60 million USD by the third quarter of 2022.
This trend suggests increasing borrowing costs or higher debt levels through 2021, with a moderate reduction in 2022. The steadiness of interest expenses, compared to the erratic EBIT, indicates consistent debt service obligations amid fluctuating operating earnings.
- Interest Coverage Ratio
-
The interest coverage ratio is characterized by pervasive negative values for most quarters, indicating that EBIT was insufficient to cover interest expenses consistently. Several quarters show ratios below -10, reflecting deep operating losses relative to interest expenses.
Notably, there is a peak positive interest coverage ratio of 10.08 observed in the third quarter of 2022, corresponding with a strong positive EBIT and lower interest expense, signifying a marked improvement in the ability to meet interest obligations from operating earnings during that quarter.
However, the frequent negative and low coverage ratios throughout the period suggest ongoing financial stress and vulnerability to interest cost burdens, with only intermittent relief as indicated by positive spikes.
In summary, the data depicts a company experiencing substantial EBITDA volatility, periodic but significant negative operating results, and a generally high burden of interest expense relative to earnings. The sporadic improvement in EBIT and interest coverage in several quarters may be indicative of temporary operational improvements or one-time events. The overall patterns emphasize episodic challenges in profitability and debt servicing capability over the observed periods.