Agilent Technologies Inc (A)
Financial leverage ratio
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 10,763,000 | 10,532,000 | 10,705,000 | 9,627,000 | 9,452,000 |
| Total stockholders’ equity | US$ in thousands | 5,845,000 | 5,305,000 | 5,389,000 | 4,873,000 | 4,748,000 |
| Financial leverage ratio | 1.84 | 1.99 | 1.99 | 1.98 | 1.99 |
October 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $10,763,000K ÷ $5,845,000K
= 1.84
The financial leverage ratio, also known as the equity multiplier, measures the amount of assets a company has relative to its equity. It indicates the extent to which a company is using debt to finance its assets. A higher financial leverage ratio suggests that the company is relying more on debt to finance its operations, while a lower ratio indicates a lower reliance on debt.
Looking at the financial leverage ratio of Agilent Technologies Inc. over the past five years, we can observe the following trends:
- In 2023, the financial leverage ratio decreased to 1.84 from 1.99 in 2022, indicating a reduction in the company's reliance on debt financing compared to the previous year.
- Over the past five years, the financial leverage ratio has remained relatively stable, fluctuating within a narrow range between 1.84 and 1.99. This suggests that the company has maintained a consistent balance in using debt to finance its assets.
- Agilent Technologies Inc. has maintained a moderate level of financial leverage, with the ratio consistently staying below 2. This indicates that the company has not aggressively leveraged its operations through excessive debt.
Overall, Agilent Technologies Inc. has managed its financial leverage in a prudent manner, maintaining a relatively stable ratio over the years. The slight decrease in the financial leverage ratio in 2023 suggests a potential shift towards a more conservative financing approach. It is essential for investors and stakeholders to monitor changes in the financial leverage ratio to assess the company's capital structure and its implications on financial risk.
Peer comparison
Oct 31, 2023