Academy Sports Outdoors Inc (ASO)
Financial leverage ratio
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | ||
|---|---|---|---|---|---|
| Total assets | US$ in thousands | 4,676,710 | 4,595,440 | 4,584,940 | 4,384,480 |
| Total stockholders’ equity | US$ in thousands | 1,954,650 | 1,628,310 | 1,466,950 | 1,111,980 |
| Financial leverage ratio | 2.39 | 2.82 | 3.13 | 3.94 |
February 3, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,676,710K ÷ $1,954,650K
= 2.39
The financial leverage ratio of Academy Sports Outdoors Inc has shown a decreasing trend over the past four years. In February 2024, the financial leverage ratio stood at 2.39, compared to 2.82 in January 2023, 3.13 in January 2022, and 3.94 in January 2021. This indicates that the company's level of financial leverage has been decreasing over time.
A decreasing financial leverage ratio suggests that the company has been relying less on debt financing to fund its operations and growth. A lower financial leverage ratio typically indicates a lower level of financial risk, as the company is less dependent on borrowed funds. This may reflect a more conservative financial strategy or a stronger financial position, as the company may have been able to generate sufficient internal funds to support its activities.
It is important to note that while a lower financial leverage ratio can reduce financial risk, it can also limit the potential returns that can be achieved through debt financing. Companies need to strike a balance between debt and equity financing to optimize their capital structure and maximize shareholder value.
Peer comparison
Feb 3, 2024