Baxter International Inc (BAX)

Financial leverage ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Total assets	US$ in thousands	28,276,000	30,656,000	27,885,000	28,291,000	28,287,000	27,965,000	31,831,000	32,716,000	33,521,000	19,807,000	19,682,000	19,466,000	20,019,000	20,098,000	19,465,000	19,075,000	18,193,000	17,299,000	17,503,000	16,241,000
Total stockholders’ equity	US$ in thousands	8,402,000	8,101,000	5,569,000	5,879,000	5,833,000	5,535,000	8,859,000	9,075,000	9,077,000	8,770,000	8,494,000	8,452,000	8,689,000	8,567,000	8,128,000	7,699,000	7,882,000	7,588,000	7,779,000	7,570,000
Financial leverage ratio		3.37	3.78	5.01	4.81	4.85	5.05	3.59	3.61	3.69	2.26	2.32	2.30	2.30	2.35	2.39	2.48	2.31	2.28	2.25	2.15

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $28,276,000K ÷ $8,402,000K
= 3.37

The financial leverage ratio of Baxter International Inc. has exhibited fluctuations over the past eight quarters. The ratio, which represents the level of debt financing relative to equity financing, provides insights into the company's capital structure and risk profile.

In Q2 2023, Baxter had a notably high financial leverage ratio of 5.01, indicating a higher reliance on debt to fund its operations and investments compared to equity. This may signify increased financial risk and potential vulnerability to changes in interest rates or market conditions during that period.

Subsequently, in Q3 2023, the financial leverage ratio decreased to 3.78, signaling a reduction in the company's debt relative to equity. This could suggest efforts to deleverage or improve financial stability by decreasing reliance on debt financing.

However, in Q4 2023, the financial leverage ratio decreased further to 3.37, reflecting a continued trend towards lower leverage and a potentially stronger balance sheet. This may be viewed positively by stakeholders as it indicates a healthier financial position with a lower debt burden.

Overall, the fluctuations in Baxter's financial leverage ratio over the analyzed period suggest varying levels of financial risk and capital structure adjustments. Investors and analysts may closely monitor these changes to assess the company's risk management practices and financial health.