Align Technology Inc (ALGN)

Financial leverage ratio

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Total assets	US$ in thousands	6,214,600	6,365,970	6,158,320	6,155,750	6,083,880	6,318,550	6,144,550	5,901,450	5,947,950	5,912,800	5,810,120	5,943,410	5,942,110	5,650,110	5,395,570	5,069,780	4,829,680	4,415,090	4,025,860	3,964,840
Total stockholders’ equity	US$ in thousands	3,851,980	3,944,350	3,757,910	3,759,860	3,630,490	3,801,870	3,638,300	3,480,050	3,601,360	3,694,620	3,599,080	3,666,850	3,622,710	3,516,760	3,384,410	3,393,580	3,233,860	3,033,470	2,845,040	2,852,990
Financial leverage ratio		1.61	1.61	1.64	1.64	1.68	1.66	1.69	1.70	1.65	1.60	1.61	1.62	1.64	1.61	1.59	1.49	1.49	1.46	1.42	1.39

December 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $6,214,600K ÷ $3,851,980K
= 1.61

Align Technology Inc's financial leverage ratio has shown a gradual increase over the years, starting at 1.39 as of March 31, 2020, and reaching 1.61 as of September 30, 2022, before slightly decreasing to 1.61 as of June 30, 2023. The ratio continued to fluctuate between 1.61 and 1.70 until December 31, 2024, with the last reported ratio being 1.61.

The increasing trend in the financial leverage ratio indicates that Align Technology Inc has been relying more on debt financing compared to its equity financing. A higher financial leverage ratio suggests that the company has a higher level of debt in its capital structure, which can magnify both returns and risks for shareholders.

It is essential for investors and stakeholders to monitor the financial leverage ratio closely as it can impact the company's financial health and overall risk profile. A high financial leverage ratio may indicate potential financial distress in the future, especially if the company struggles to generate sufficient profits to cover its debt obligations.