AutoNation Inc (AN)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 13,001,700 | 11,980,000 | 10,059,700 | 8,943,600 | 9,887,200 |
| Total stockholders’ equity | US$ in thousands | 2,457,300 | 2,211,400 | 2,047,800 | 2,377,000 | 3,235,700 |
| Financial leverage ratio | 5.29 | 5.42 | 4.91 | 3.76 | 3.06 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $13,001,700K ÷ $2,457,300K
= 5.29
The financial leverage ratio of AutoNation Inc has shown an upward trend over the years, increasing from 3.06 at the end of 2020 to 5.29 by the end of 2024. This indicates that the company has been relying more on debt financing relative to equity as time progresses. A higher financial leverage ratio suggests that a company has a higher level of debt compared to its equity, which can potentially amplify returns on equity but also increases financial risk. It is important for stakeholders to closely monitor this trend to ensure that the company maintains a balance between debt and equity to support sustainable growth and financial stability.
Peer comparison
Dec 31, 2024