Cardinal Health Inc (CAH)
Financial leverage ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 45,121,000 | 43,349,000 | 43,878,000 | 44,453,000 | 40,766,000 |
| Total stockholders’ equity | US$ in thousands | -3,213,000 | -2,958,000 | -709,000 | 1,791,000 | 1,789,000 |
| Financial leverage ratio | — | — | — | 24.82 | 22.79 |
June 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $45,121,000K ÷ $-3,213,000K
= —
Based on the financial leverage ratio data provided, we can observe an increasing trend in Cardinal Health Inc's financial leverage ratio over the past few years. The financial leverage ratio, which measures the proportion of a company's assets that are financed by debt compared to equity, was 24.82 in 2021 and 22.79 in 2020.
The absence of data for 2022 and 2023 prevents a full analysis of the trend. However, the significant increase in the financial leverage ratio from 2020 to 2021 indicates a potential shift towards higher debt financing relative to equity. This increase may suggest that Cardinal Health Inc has been relying more on debt to finance its operations and investments.
A higher financial leverage ratio indicates a higher level of financial risk as the company has more debt relative to its equity, which can lead to increased interest expenses and potential solvency issues during economic downturns.
In conclusion, the increasing trend in Cardinal Health Inc's financial leverage ratio over the past years highlights the company's growing reliance on debt financing, potentially signaling a shift in its capital structure towards higher leverage. Further analysis and monitoring of this ratio along with other financial metrics are recommended to assess the company's overall financial health and risk profile.
Peer comparison
Jun 30, 2024