Allegheny Technologies Incorporated (ATI)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 5,230,600 | 4,985,100 | 4,445,600 | 4,285,200 | 4,034,900 |
| Total stockholders’ equity | US$ in thousands | 1,850,400 | 1,373,000 | 1,045,900 | 685,600 | 521,100 |
| Financial leverage ratio | 2.83 | 3.63 | 4.25 | 6.25 | 7.74 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,230,600K ÷ $1,850,400K
= 2.83
The financial leverage ratio, also known as the debt-to-equity ratio, measures the extent to which a company relies on debt financing rather than equity. In the case of Allegheny Technologies Incorporated, the financial leverage ratio has shown a declining trend over the past five years, decreasing from 7.74 in 2020 to 2.83 in 2024.
This decrease indicates that Allegheny Technologies has been reducing its reliance on debt to finance its operations and growth. A lower financial leverage ratio generally suggests a lower level of financial risk for the company, as it implies less debt in the capital structure compared to equity.
The decreasing trend in the financial leverage ratio of Allegheny Technologies could be a positive sign for investors and creditors, as it indicates improved financial stability and a stronger balance sheet. However, it's important to analyze this ratio in conjunction with other financial metrics to get a comprehensive view of the company's financial health and risk profile.