BorgWarner Inc (BWA)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 13,993,000 | 14,453,000 | 16,994,000 | 16,575,000 | 16,029,000 |
| Total stockholders’ equity | US$ in thousands | 5,532,000 | 5,828,000 | 7,224,000 | 6,948,000 | 6,428,000 |
| Financial leverage ratio | 2.53 | 2.48 | 2.35 | 2.39 | 2.49 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $13,993,000K ÷ $5,532,000K
= 2.53
The financial leverage ratio of BorgWarner Inc has exhibited a slight decrease over the years, from 2.49 in December 31, 2020, to 2.39 in December 31, 2021, further decreasing to 2.35 in December 31, 2022. However, there was a slight increase in the ratio to 2.48 in December 31, 2023, followed by a slight rise to 2.53 in December 31, 2024. This ratio suggests that the company relies more on debt financing as compared to equity financing to support its operations and growth, and indicates the level of financial risk associated with the company's capital structure. Overall, maintaining a relatively stable financial leverage ratio is crucial to ensuring a balance between debt and equity funding for BorgWarner Inc.
Peer comparison
Dec 31, 2024