BorgWarner Inc (BWA)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 14,453,000 | 16,994,000 | 16,575,000 | 16,029,000 | 9,702,000 |
| Total stockholders’ equity | US$ in thousands | 5,828,000 | 7,224,000 | 6,948,000 | 6,428,000 | 4,706,000 |
| Financial leverage ratio | 2.48 | 2.35 | 2.39 | 2.49 | 2.06 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $14,453,000K ÷ $5,828,000K
= 2.48
The financial leverage ratio of BorgWarner Inc has shown fluctuations over the past five years, ranging from 2.06 in 2019 to 2.49 in 2020. In 2023, the ratio stands at 2.48. This indicates that the company relies more on debt financing compared to equity to support its operations and growth initiatives. A higher financial leverage ratio suggests that BorgWarner Inc has a higher level of financial risk due to increased debt obligations. However, it also implies that the company may have the potential for higher returns on equity as a result of leveraging debt. It is important for stakeholders to closely monitor this ratio, as significant changes could impact the company's financial stability and performance in the long run.
Peer comparison
Dec 31, 2023