Balchem Corporation (BCPC)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 1,575,370 | 1,597,210 | 1,624,510 | 1,199,320 | 1,165,840 |
| Total stockholders’ equity | US$ in thousands | 1,149,910 | 1,053,980 | 938,284 | 877,015 | 828,233 |
| Financial leverage ratio | 1.37 | 1.52 | 1.73 | 1.37 | 1.41 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,575,370K ÷ $1,149,910K
= 1.37
The financial leverage ratio, also known as the debt-to-equity ratio, measures the extent to which a company is using debt to finance its operations and growth.
Analyzing the financial leverage ratio of Balchem Corporation over the past five years reveals some interesting trends.
As of December 31, 2020, the financial leverage ratio stood at 1.41, indicating that the company had $1.41 of debt for every $1 of equity.
Over the following years, we observed fluctuations in the ratio. By December 31, 2021, the ratio had decreased slightly to 1.37, suggesting a reduction in the company's reliance on debt financing.
However, in the subsequent year, by December 31, 2022, the ratio increased significantly to 1.73, signaling a higher proportion of debt in Balchem Corporation's capital structure.
The financial leverage ratio then decreased to 1.52 by December 31, 2023, indicating a moderation in the company's debt levels.
Finally, as of December 31, 2024, the ratio reverted back to 1.37, the same level observed in 2021, which could imply a stabilization in Balchem Corporation's debt-to-equity position.
Overall, the trend in Balchem Corporation's financial leverage ratio suggests a mix of fluctuations and stability in the company's debt utilization over the past five years. It is essential for stakeholders to continue monitoring this ratio to assess the firm's risk profile and financial health accurately.
Peer comparison
Dec 31, 2024