American Axle & Manufacturing (AXL)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 5,356,300 | 5,469,400 | 5,635,700 | 5,916,300 | 6,644,600 |
| Total stockholders’ equity | US$ in thousands | 604,900 | 627,300 | 457,800 | 370,500 | 977,600 |
| Financial leverage ratio | 8.85 | 8.72 | 12.31 | 15.97 | 6.80 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,356,300K ÷ $604,900K
= 8.85
The financial leverage ratio of American Axle & Manufacturing Holdings Inc has shown fluctuating trends over the past five years. The ratio was relatively stable at a high level in 2023 and 2022, with values of 8.85 and 8.72 respectively. This suggests that the company relies heavily on debt to fund its operations and investments during these periods.
However, in 2021 and 2020, the financial leverage ratio increased significantly to 12.31 and 15.97 respectively. This indicates a higher level of debt usage compared to the previous years, potentially exposing the company to higher financial risk due to the increased reliance on borrowed funds.
In contrast, the financial leverage ratio decreased substantially in 2019 to a relatively low level of 6.80. This could imply a reduction in debt levels or an increase in equity financing, leading to a stronger financial position with less dependency on borrowed capital.
Overall, the varying levels of the financial leverage ratio suggest that American Axle & Manufacturing Holdings Inc has experienced fluctuations in its capital structure over the years, indicating shifts in the balance between debt and equity financing. Further analysis would be necessary to understand the reasons behind these changes and their implications for the company's financial stability and risk profile.
Peer comparison
Dec 31, 2023