Allegro Microsystems Inc (ALGM)

Financial leverage ratio

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Total assets	US$ in thousands	1,530,600	1,181,160	892,620	747,678
Total stockholders’ equity	US$ in thousands	1,130,440	965,628	734,207	585,752
Financial leverage ratio		1.35	1.22	1.22	1.28

March 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,530,600K ÷ $1,130,440K
= 1.35

The financial leverage ratio of Allegro Microsystems Inc has shown some fluctuations over the past four years. The ratio was 1.35 as of March 31, 2024, indicating that the company had $1.35 in debt for every $1 of equity. This represents an increase compared to the previous year, where the ratio was 1.22 in both 2023 and 2022. In 2021, the ratio was slightly lower at 1.28.

A financial leverage ratio above 1 suggests that the company relies more on debt financing than equity financing. The increase in the ratio from 2023 to 2024 may indicate that the company has taken on more debt relative to its equity, possibly to fund growth opportunities or operational expenses. However, it is important to assess the company's overall financial health and ability to manage its debt levels effectively in light of this increase.