EQT Corp. (NYSE:EQT)

The analysis of the financial ratios over the presented quarters reveals several key trends related to the company's leverage and ability to service debt.

Debt to Equity

This ratio fluctuates over time, with values ranging from a low of 0.44 to a high of 0.77. After peaking near the end of 2018, the ratio generally decreases toward early 2020 before increasing again in late 2021 to around 0.75, then declining thereafter. This suggests variable reliance on equity relative to debt, with a somewhat cyclical behavior.

Debt to Capital

The debt to capital ratio follows a moderate fluctuating pattern, varying between 0.31 and 0.44. The ratio shows an initial decline from 0.39 in early 2018 to roughly 0.31 by mid-2019, then increases to a peak near late 2021 before gradually trending downward toward late 2022. The movements indicate shifts in the capital structure but remain within a close range.

Debt to Assets

This ratio demonstrates a steady, gradual decline from a high of 0.30 in late 2018 to a low near 0.21 by late 2022. The continuous decrease implies reduced leverage relative to total assets, potentially due to asset growth or debt reduction over time.

Financial Leverage

Financial leverage peaks in late 2018 at 2.61 before dropping significantly to under 2.0 through most of 2019 and 2020. A resurgence occurs in late 2021 with a peak near 2.79, followed by a reduction back toward 2.34 by late 2022. This indicates a period of both increased and decreased reliance on borrowed funds relative to equity.

Interest Coverage

The interest coverage ratio presents substantial volatility and frequent negative values between 2018 and 2022, reflecting difficulties in covering interest expenses from operating earnings. Values dip as low as -12.44, indicating significant recurring losses or insufficient earnings. A notable improvement occurs in the last observed quarter with a positive reading of 10.08, suggesting a turnaround in the company’s ability to cover interest costs.

Overall, the data displays an evolving leverage structure with reductions in debt relative to assets and capital noted over the period. However, fluctuations in debt to equity and financial leverage ratios indicate periodic adjustments in financing approaches. The persistent negative interest coverage ratios for many quarters highlight ongoing challenges in earnings capacity, though the latest period shows encouraging improvement in interest coverage.

The financial data over the analyzed periods reveals notable fluctuations in total debt, common shareholders’ equity, and the debt-to-equity ratio. These movements provide insight into the company's capital structure and financial leverage trends across multiple quarters.

Total Debt

Total debt exhibited a rising trend from March 2018 through June 2018, peaking around 8.53 billion US dollars. This was followed by a general decline with some fluctuations, reaching a low of approximately 4.76 billion US dollars in September 2022. Notably, the total debt saw a significant decrease starting in late 2018 and has mostly remained below the earlier peak level, indicating efforts toward deleveraging or repayment of debt over time.

Common Shareholders’ Equity

Common shareholders’ equity started around 11.7 billion US dollars in early 2018 and experienced a gradual decline through March 2020, bottoming near 8.8 billion. Subsequently, it showed considerable volatility but with a general upward trend between late 2020 and September 2022, reaching approximately 9.6 billion US dollars. The equity decrease during the earlier periods may reflect asset write-downs or losses, while the later increase suggests recovery or capital injections.

Debt to Equity Ratio

The debt-to-equity ratio mirrored these trends, initially rising from 0.64 to a peak of 0.77 in late 2018, before dropping substantially to 0.44 by mid-2019. It then fluctuated, increasing again to 0.75 by September 2021 and subsequently decreasing toward a ratio near 0.50 by the third quarter of 2022. This pattern indicates changing leverage levels, with a period of lower leverage around mid-2019 followed by higher leverage conditions in 2021, and a subsequent move back towards a more conservative capital structure.

Overall, the company has demonstrated efforts to reduce its total debt from the high levels seen in 2018 while navigating declines and recoveries in shareholders’ equity. The resultant variations in the debt-to-equity ratio reflect adjustments in financing strategy, alternating between leveraging and deleveraging phases. The recent downward trend in the debt-to-equity ratio suggests a shift toward reducing financial risk and maintaining a more balanced capital structure heading into late 2022.

The analysis of the quarterly financial data reveals several key trends in the company's debt and capital structure over the observed periods.

Total Debt

Total debt exhibits a fluctuating pattern from March 2018 through September 2022. Initially, there is a general increase, peaking around the second and third quarters of 2018, with the highest value at approximately 8.5 billion US dollars. Following this peak, a noticeable decline occurs entering 2019 and continuing into early 2020, with total debt dropping below 5 billion US dollars by March 2020. In the subsequent quarters, debt levels fluctuate moderately, with a slight increase in late 2021, reaching over 6 billion US dollars in the third quarter of 2021 before declining again toward the latter half of 2022, ending near 4.77 billion US dollars.

Total Capital

Total capital also reflects variability but with an overall downward trend from early 2018 to mid-2020, decreasing from approximately 19.2 billion to about 13.6 billion US dollars. After mid-2020, there is a modest recovery and partial rebound in capital, reaching over 15.5 billion US dollars by the fourth quarter of 2021. However, the capital decreases again in early 2022, stabilizing around 14.4 billion US dollars by the third quarter of 2022. The changes suggest shifts in financing structure, likely influenced by capital market conditions and operational strategies.

Debt to Capital Ratio

The debt to capital ratio fluctuates between 0.31 and 0.44 during the reported period. In 2018, this ratio starts around 0.39, increases to 0.44 by the third quarter, but then declines sharply to about 0.33 at the end of the year. Throughout 2019, the ratio remains relatively stable, hovering near 0.31 to 0.35, indicating a consistently moderate proportion of debt compared to total capital. Moving into 2020 and 2021, the ratio experiences slight volatility, with an increase to above 0.40 in mid to late 2021, reflecting a higher leverage point during that period. By 2022, the ratio trends downward again, approaching 0.33 by the third quarter.

Overall, the ratio indicates that the company maintains a moderate leverage profile, with periods of tightening and loosening in debt financing relative to total capital.

The analysis of the quarterly financial data reveals several important trends related to the company's leverage and asset base over the observed periods.

Total Debt

The total debt levels experienced fluctuations over the years. Initially, debt increased from approximately 7.46 billion USD at the end of Q1 2018 to peak near 8.53 billion USD by mid-2018. Subsequently, the debt declined steadily, reaching around 4.76 billion USD by Q3 2022. A noticeable dip is observed beginning in late 2018, which continued into 2019 and remained relatively stable with minor variations thereafter. Despite some quarterly increases, the overall trend across the four-and-a-half-year period is a reduction in total debt.

Total Assets

Total assets demonstrate considerable variability. Initially standing at approximately 27.63 billion USD in Q1 2018, the asset base dropped sharply by nearly 10 billion USD by the end of 2018. From early 2019 through mid-2020, assets remained in the 17.5 to 20.5 billion USD range, signaling a contraction in the asset base during that period. Starting in late 2020, assets began to recover, rising steadily to exceed 22.5 billion USD by mid-2022, suggesting a rebound or expansion in asset holdings after a period of decline.

Debt to Assets Ratio

The debt to assets ratio ranged between 0.21 and 0.30, reflecting moderate leverage with some volatility. The ratio peaked around 0.30 in late Q3 2018, concurrent with high debt levels and reduced assets. Following this peak, the ratio generally trended downward, indicating an improvement in financial leverage, reaching a low point of 0.21 by Q3 2022. This suggests a gradual strengthening of the company’s balance sheet, with debt decreasing relative to assets.

Overall, the data shows an initial period of elevated debt and asset contraction through 2018, followed by a deleveraging phase marked by debt reduction and asset recovery from 2019 onward. The debt to assets ratio decline reinforces this interpretation, suggesting improved financial stability and potentially enhanced capacity for future growth or risk management.

The analysis of the quarterly financial data reveals several notable trends in the company’s financial position over the observed periods.

Total Assets

The total assets exhibited fluctuations with an initial peak around June 2018 at approximately 28.96 billion US dollars, followed by a significant decline by the end of 2018 to around 20.72 billion US dollars. During 2019 and the first half of 2020, total assets remained relatively stable but lower compared to the earlier peak, oscillating between approximately 18 billion and 20 billion US dollars. A modest recovery is observed starting mid-2021, culminating in a peak near 23 billion US dollars by September 2021, before experiencing a slight decrease again toward the end of the available data in September 2022.

Common Shareholders’ Equity

Common shareholders’ equity showed a downward trend starting from over 11.7 billion US dollars in early 2018 to a trough below 9 billion US dollars by the end of 2020. This decline continued into mid-2021, reaching a minimum of about 8.3 billion US dollars. However, a recovery trend emerged from late 2021 into 2022, with equity rising to nearly 9.6 billion US dollars by the third quarter of 2022. Despite this improvement, equity levels in 2022 remain below the early 2018 figures, indicating some erosion of equity over the time span.

Financial Leverage

The financial leverage ratio fluctuated in the range of approximately 1.8 to 2.8 times during the observed dates. Initially, it increased from 2.36 in early 2018 to a peak of 2.61 by September 2018, then sharply declined to below 2 times by the end of 2018. From 2019 through 2020, leverage ratios were relatively stable, mostly hovering around 1.9 to 2.0. Starting from mid-2021, leverage increased sharply, reaching a high of 2.79 by September 2021 before declining somewhat toward a ratio near 2.3 by late 2022. This pattern suggests a period of increased borrowing or decreased equity relative to assets during mid-2021 followed by some deleveraging.

Overall, the asset base declined substantially in late 2018 and showed moderate recovery post-2020. Shareholders’ equity weakened significantly during the same period but showed signs of recovery starting late 2021. Financial leverage experienced notable volatility but remained within a range that indicates a moderate level of debt usage relative to equity. The changes in leverage correspond with the equity and asset movements, evidencing shifts in the company’s capital structure and possibly reflecting strategic or market-driven financing adjustments over the periods analyzed.

Earnings before interest and tax (EBIT)

The EBIT values demonstrate significant volatility across the analyzed quarters. Initially, there is a substantial negative EBIT of approximately -1.95 billion US dollars in the first quarter of 2018, followed by a marked improvement and reduction in losses through mid-2018. By the first quarter of 2019, EBIT swings into positive territory, peaking around 285 million US dollars, indicating a short-term recovery. However, this is followed by increasing fluctuations and sharp declines, including a notable downturn in the fourth quarter of 2019 and again in late 2021. There is a pronounced positive surge close to 2.47 billion US dollars at the end of 2021 before EBIT returns to negative figures early in 2022. The pattern reflects cyclical performance with a mixture of intermittent gains and strong negative results.

Interest Expense

Interest expense figures remain relatively stable across the quarters, fluctuating within a narrow range between approximately 45,066 thousand and 80,349 thousand US dollars. There is no significant upward or downward trend, suggesting consistent debt service costs. The values show a slight tendency to increase towards late 2020 and 2021, peaking around 80,349 thousand US dollars, followed by minor declines in the subsequent periods of 2022.

Interest Coverage Ratio

The interest coverage ratio exhibits considerable instability throughout the periods analyzed. Early values are missing, but from the fourth quarter of 2018 forward, the ratio is mostly negative, indicating that EBIT is insufficient to cover interest expenses, thus signaling operating losses relative to interest obligations. The coverage deteriorates sharply in several quarters, including late 2019 and 2021, with ratios reaching as low as approximately -11.79. An exception occurs in the last period analyzed, where the ratio rises sharply to a positive value of 10.08, reflecting a scenario where EBIT exceeds interest expenses by a significant margin. This abrupt change suggests a temporary improvement in operational earnings relative to debt costs.