Ball Corporation (BALL)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 17,628,000 | 19,303,000 | 19,909,000 | 19,714,000 | 18,252,000 |
| Total stockholders’ equity | US$ in thousands | 5,930,000 | 3,769,000 | 3,527,000 | 3,685,000 | 3,337,000 |
| Financial leverage ratio | 2.97 | 5.12 | 5.64 | 5.35 | 5.47 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $17,628,000K ÷ $5,930,000K
= 2.97
The financial leverage ratio measures the extent to which a company relies on debt to finance its operations and growth. A higher financial leverage ratio indicates a higher level of debt relative to equity, which can increase the company's financial risk.
For Ball Corporation, the financial leverage ratio has fluctuated over the past five years, ranging from 2.97 to 5.64. In 2020, the ratio was 5.47, showing a high reliance on debt. However, it decreased to 5.35 in 2021, increased to 5.64 in 2022, and decreased significantly to 5.12 in 2023. In the most recent year, 2024, the ratio dropped to 2.97, signaling a significant decrease in the company's debt level relative to equity.
The downward trend in the financial leverage ratio from 2020 to 2024 may indicate that Ball Corporation has been reducing its reliance on debt to finance its operations. This reduction could potentially lower the company's financial risk and improve its overall financial health. However, it is also important to consider the reasons behind these fluctuations and their potential impacts on the company's long-term sustainability and growth prospects.
Peer comparison
Dec 31, 2024