ABM Industries Incorporated (ABM)
Financial leverage ratio
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 5,097,200 | 4,933,700 | 4,868,900 | 4,436,200 | 3,776,900 |
| Total stockholders’ equity | US$ in thousands | 1,781,900 | 1,799,900 | 1,717,200 | 1,609,200 | 1,500,300 |
| Financial leverage ratio | 2.86 | 2.74 | 2.84 | 2.76 | 2.52 |
October 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,097,200K ÷ $1,781,900K
= 2.86
The financial leverage ratio of ABM Industries Incorporated has been gradually increasing over the past five years, from 2.52 in October 2020 to 2.86 in October 2024. This indicates that the company has been relying more on debt financing to support its operations and growth. A higher financial leverage ratio implies that a larger portion of the company's assets are funded by debt rather than equity. While a higher leverage ratio can amplify returns during good economic times, it also exposes the company to greater financial risk during economic downturns or in times of rising interest rates. It is essential for ABM Industries to carefully manage its debt levels to ensure financial stability and sustainability in the long term.
Peer comparison
Oct 31, 2024