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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- Statement of Comprehensive Income
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Price to FCFE (P/FCFE)
- Present Value of Free Cash Flow to Equity (FCFE)
- Operating Profit Margin since 2005
- Analysis of Debt
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Solvency Ratios (Summary)
Valero Energy Corp., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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).
The financial data reveals several notable trends and fluctuations over the observed periods.
- Debt to equity
- This ratio increased from 0.47 in March 2019 to peak around 0.83 in June 2021, indicating a rising reliance on debt relative to equity during this interval. Subsequently, it steadily declined to approximately 0.42-0.43 toward mid-to-late 2024, suggesting a reduction in leverage or strengthening equity base in recent quarters.
- Debt to capital
- The debt to capital ratio followed a pattern consistent with debt to equity, rising from 0.32 in early 2019 to a high near 0.45 in late 2021, before gradually decreasing to around 0.29-0.30 by mid-2024. This mirrors the trend of increased leverage followed by deleveraging or improved capital structure over time.
- Debt to assets
- This ratio also showed an increase from approximately 0.19 in 2019 to about 0.26 in mid-2021, indicating a growing proportion of assets financed by debt during that period. Afterward, it declined gradually and stabilized around 0.17-0.18 by mid-2024, reflecting a modest reduction in debt relative to total assets or possibly asset growth outpacing debt.
- Financial leverage
- Financial leverage ratios remained relatively stable around 2.44 through 2019, then increased to peak approximately 3.21 in early 2022, showing increased use of debt funding relative to equity. Following this peak, the ratio decreased significantly to near 2.39-2.5 by mid-2024, indicating a return to a more conservative leverage position.
- Interest coverage
- Interest coverage experienced significant volatility. Starting at 8.68 in September 2019, it declined sharply, turning negative in December 2020 and several quarters thereafter, reflecting periods where operating income was insufficient to cover interest expenses. Notably, from early 2022 onwards, the interest coverage ratio improved markedly, reaching a high of 33.17 in December 2022, demonstrating substantially enhanced ability to meet interest obligations. This ratio then gradually decreased to 9.64 by mid-2024, yet remained at relatively healthy levels compared to earlier negativities.
Overall, the data indicates a phase of increased financial leverage and debt usage culminating around 2021-early 2022, followed by a consistent effort to reduce debt levels and strengthen the balance sheet in subsequent periods. The fluctuations in interest coverage highlight challenges faced in servicing debt obligations during peak leverage phases, with a strong recovery in coverage ratios post-2021 signaling improved earnings capacity or reduced interest burdens.
Debt Ratios
Coverage Ratios
Debt to Equity
Valero Energy Corp., debt to equity calculation (quarterly data)
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Current portion of debt and finance lease obligations | ||||||||||||||||||||||||||||||
| Debt and finance lease obligations, less current portion | ||||||||||||||||||||||||||||||
| Total debt | ||||||||||||||||||||||||||||||
| Total Valero Energy Corporation stockholders’ equity | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Debt to equity1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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 2024 Calculation
Debt to equity = Total debt ÷ Total Valero Energy Corporation stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The analysis of the financial data over the periods presented reveals distinct trends in the capital structure of the company, focusing on its total debt, stockholders’ equity, and the debt to equity ratio.
- Total Debt
- Total debt showed an increasing trend from March 31, 2019, starting at $10,116 million, and peaked around September 30, 2020, reaching $15,213 million. Following this peak, there was a gradual decline with some fluctuations, decreasing to $10,806 million by September 30, 2024. This indicates a phase of rising leverage through 2019 and early 2020, followed by efforts to reduce overall debt levels through to 2024.
- Total Stockholders’ Equity
- Stockholders’ equity initially experienced a slight decline from $21,309 million at March 31, 2019, to a low of $17,801 million at March 31, 2021. Subsequently, there was a consistent upward trajectory, reaching $26,346 million by March 31, 2024, although a minor decrease occurred towards the last period shown, closing at $25,253 million by September 30, 2024. This suggests improving equity strength and potential retained earnings growth after early 2021.
- Debt to Equity Ratio
- The debt to equity ratio rose significantly from 0.47 at March 31, 2019, to a peak of 0.83 on June 30, 2021, reflecting an increased reliance on debt financing relative to equity during this period. After mid-2021, the ratio steadily decreased to around 0.42-0.43 by mid to late 2024. The reduction in this ratio correlates with the reduction in total debt and increase in equity, indicating a move towards a more balanced and less leveraged capital structure.
Overall, the data indicate that the company experienced an initial phase of increased leverage, likely related to financing needs or investment activities during the 2019–2020 period. From 2021 onward, the company improved its financial position by increasing equity and reducing debt, leading to a more conservative leverage profile by 2024. This trend is generally favorable from a risk management perspective and may suggest an improved capacity for funding through internally generated funds or lower dependency on external debt.
Debt to Capital
Valero Energy Corp., debt to capital calculation (quarterly data)
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Current portion of debt and finance lease obligations | ||||||||||||||||||||||||||||||
| Debt and finance lease obligations, less current portion | ||||||||||||||||||||||||||||||
| Total debt | ||||||||||||||||||||||||||||||
| Total Valero Energy Corporation stockholders’ equity | ||||||||||||||||||||||||||||||
| Total capital | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Debt to capital1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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 2024 Calculation
Debt to capital = Total debt ÷ Total capital
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals notable trends in the company's debt structure and capital management over the observed period.
- Total Debt
- Total debt showed a general upward trend from March 2019 through December 2020, increasing from approximately $10.1 billion to a peak near $15.2 billion in September 2020. Following this peak, total debt gradually decreased, reaching around $10.8 billion by the most recent quarter ending in September 2024. This indicates a phase of debt accumulation followed by a sustained period of deleveraging or debt reduction.
- Total Capital
- Total capital exhibited relative stability, fluctuating moderately around the $30 billion to $35 billion range through early periods. Starting from approximately $31.4 billion in March 2019, total capital peaked near $37.4 billion in December 2023, before slightly declining to approximately $36.1 billion by September 2024. This pattern suggests progressive capital growth with minor contractions towards the end of the period.
- Debt to Capital Ratio
- The debt to capital ratio reinforced the observations in debt and capital trends. Initially, the ratio was steady at about 0.31 through 2019, then it increased to a high near 0.44 by late 2020, consistent with the surge in total debt during that period. Subsequently, the ratio consistently declined to about 0.30 by most of 2023 and maintained this level into 2024, reflecting a reduction in leverage relative to the capital base.
Overall, the financial data depicts an initial period characterized by increased leverage and debt accumulation, peaking towards the end of 2020. This was followed by a gradual strategy aimed at debt reduction and improved capital structure stability. The stabilization of total capital alongside the falling debt to capital ratio suggests a strategic effort to strengthen the balance sheet and reduce financial risk over recent years.
Debt to Assets
Valero Energy Corp., debt to assets calculation (quarterly data)
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Current portion of debt and finance lease obligations | ||||||||||||||||||||||||||||||
| Debt and finance lease obligations, less current portion | ||||||||||||||||||||||||||||||
| Total debt | ||||||||||||||||||||||||||||||
| Total assets | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Debt to assets1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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 2024 Calculation
Debt to assets = Total debt ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
- Total Debt
- Over the observed periods, total debt displays an initial fluctuating upward trend, increasing from approximately 10,116 million USD in March 2019 to a peak of about 15,213 million USD in September 2020. Following this peak, total debt gradually declines, reaching around 10,806 million USD by September 2024. Notably, significant increases are seen during early 2020, coinciding with the onset of the global economic disruptions, followed by a steady deleveraging phase through 2023 and 2024.
- Total Assets
- Total assets exhibit moderate volatility over the time frame. From March 2019, the value decreases from approximately 52,095 million USD to a trough near 47,747 million USD in March 2020. Thereafter, a recovery trend is evident, with assets rising to a high of about 64,345 million USD in June 2022. Subsequent periods show some fluctuations but generally maintain levels above 60,000 million USD, ending at approximately 60,382 million USD in September 2024.
- Debt to Assets Ratio
- The debt to assets ratio moves in line with the changes in debt and asset values. It begins near 0.19 in early 2019, rises markedly to a peak around 0.29 in September 2020, reflecting increased leverage coinciding with higher debt and lower asset bases during economic downturn. From this peak, the ratio trends downward steadily to about 0.18 by September 2024, indicative of improved balance sheet strength with either reduced debt levels or enhanced asset base, or a combination of both.
- Overall Trends and Insights
- The financial data indicate a period of heightened leverage through mid-2020, likely driven by external economic pressures necessitating increased borrowing. Following this period, the company pursues a deleveraging strategy, successfully reducing total debt and improving asset holdings. The asset base recovers robustly after mid-2020, contributing to the decreased leverage ratio. The reduction in the debt to assets ratio post-2020 signals improved financial stability and possibly better credit risk profile. The steady total assets level in recent quarters suggests controlled asset management amid refinancing or repayments.
Financial Leverage
Valero Energy Corp., financial leverage calculation (quarterly data)
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Total assets | ||||||||||||||||||||||||||||||
| Total Valero Energy Corporation stockholders’ equity | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Financial leverage1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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 2024 Calculation
Financial leverage = Total assets ÷ Total Valero Energy Corporation stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several key trends and patterns related to the company's asset base, equity position, and financial leverage from March 2019 to September 2024.
- Total Assets
- Total assets exhibited some fluctuation over the period analyzed. Initially, assets slightly decreased from about 52,095 million USD in March 2019 to 47,747 million USD by March 2020, likely reflecting operational or market impacts early in this timeframe. Subsequently, there was a general upward trend, reaching a peak of 64,345 million USD in June 2022. However, following this peak, total assets showed volatility with a downward correction to approximately 60,382 million USD by September 2024. This indicates an overall expansion in the asset base over the long term with intermittent periods of contraction.
- Total Stockholders’ Equity
- Stockholders' equity started at 21,309 million USD in March 2019, but then declined steadily until reaching a low point around the first quarter of 2021, approximately 17,476 million USD. After that, equity demonstrated a recovery phase with a notable upward trend peaking at 26,346 million USD in March 2024. Toward the end of the period, equity slightly decreased to about 25,253 million USD in September 2024. This pattern suggests that while the company’s equity base faced pressures possibly from market conditions or operational challenges, it managed a substantial rebound and capital strengthening through the later periods.
- Financial Leverage
- Financial leverage increased from a ratio of 2.44 in early 2019 to a peak of around 3.21 in March 2022, indicating an increasing reliance on debt relative to equity during that interval. From that peak, leverage decreased steadily, bottoming out at approximately 2.35 by June 2023 before showing slight variability but remaining at lower levels compared to the peak. By September 2024, the financial leverage ratio was about 2.39, close to early-period levels but substantially lower than the maximum recorded. This trend signals a phase of deleveraging after a period of elevated borrowing or financial risk.
Overall, the data suggests a company that underwent a contraction in assets and equity around early 2020, followed by recovery and growth in both assets and equity through 2022 and early 2024. The financial leverage trend corroborates this, reflecting increased borrowing during the mid-period with subsequent efforts to reduce leverage and strengthen the equity base. These dynamics may indicate strategic adjustments to market conditions, risk management, and capital structure optimization over the observed timeframe.
Interest Coverage
Valero Energy Corp., interest coverage calculation (quarterly data)
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Net income (loss) attributable to Valero Energy Corporation stockholders | ||||||||||||||||||||||||||||||
| Add: Net income attributable to noncontrolling interest | ||||||||||||||||||||||||||||||
| Add: Income tax expense | ||||||||||||||||||||||||||||||
| Add: Interest and debt expense, net of capitalized interest | ||||||||||||||||||||||||||||||
| Earnings before interest and tax (EBIT) | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Interest coverage1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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 2024 Calculation
Interest coverage
= (EBITQ3 2024
+ EBITQ2 2024
+ EBITQ1 2024
+ EBITQ4 2023)
÷ (Interest expenseQ3 2024
+ Interest expenseQ2 2024
+ Interest expenseQ1 2024
+ Interest expenseQ4 2023)
= ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The analysis of the financial data reveals the following trends and insights concerning earnings, interest expenses, and interest coverage ratios over the periods observed.
- Earnings Before Interest and Tax (EBIT)
-
EBIT shows significant volatility throughout the periods. Positive earnings are observed initially in 2019, with a peak in December 2019 at 1,775 million US dollars, followed by a sharp decline to -2,245 million US dollars in March 2020, indicating a notable loss likely influenced by external economic factors.
Subsequent quarters display a recovery with fluctuations, including negative values in some quarters of 2020 (e.g., -573 and -445 million in September and December 2020 respectively), and improving positive EBIT from 2021 onwards. A high peak is noted in June 2022 with 6,252 million US dollars, indicating strong operational performance during that period.
After this peak, EBIT remains positive but generally trends downward toward March 2024, settling at 630 million US dollars, suggesting reduced profitability compared to mid-2022 but still above earlier negative quarters.
- Interest and Debt Expense, Net of Capitalized Interest
-
Interest expenses have steadily increased from 112 million US dollars in early 2019 to about 149-153 million US dollars in most quarters of 2020 through 2021. From 2022 onwards, these expenses marginally decrease and stabilize around 140-146 million US dollars, indicating relatively consistent borrowing costs or debt levels over time.
- Interest Coverage Ratio
-
The interest coverage ratio demonstrates notable variability, reflective of EBIT fluctuations. Early 2019 shows no provided ratio, but starting March 2020, the ratio drops sharply to 2.92, declining further below 1 in several quarters of 2020 and early 2021, including negative figures (e.g., -2.57, -1.73), indicating insufficient EBIT to cover interest expenses during those periods.
From mid-2021 onwards, the interest coverage ratio improves markedly, reaching a peak of 33.17 in December 2022. This significant increase aligns with the peak EBIT observed and suggests strong capacity to service debt at that time.
Subsequently, the ratio decreases but remains comfortably above 1 through 2023 and early 2024, indicating sustained ability to cover interest obligations albeit at a declining margin.
In summary, the financial data indicates a period of operational instability and losses during early 2020 followed by a strong recovery through late 2021 and 2022, culminating in peak profitability and debt servicing capacity towards the end of 2022. Interest expenses have remained steady with minor fluctuations, while the interest coverage ratio highlights phases of both financial strain and robust earnings relative to debt costs. The trends point to improved financial health post-2020, albeit with some easing in EBIT and coverage ratios by early 2024.