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Looking at Anadarko Petroleum’s Leverage

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Trends in Anadarko’s leverage

Anadarko Petroleum’s (APC) total debt has fallen considerably. Whereas it was $18.7 billion in 1Q16, it was ~$15.3 billion in 1Q17—a decline of ~22%.

Anadarko’s total debt-to-equity ratio also fell, from ~160% in 1Q16 to ~129% in 1Q17. A higher debt-to-equity ratio usually indicates that a company has been aggressively financing its growth through debt. However, a decline in Anadarko’s debt-to-equity ratio could be seen as a positive sign by its investors.

Upstream peers Apache (APA) and Continental Resources (CLR) have debt-to-equity ratios of 130% and 151%, respectively. Together, they make up 4.8% of the Energy Select Sector SPDR ETF (XLE).

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