Century Communities Inc (CCS)

Financial leverage ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Total assets	US$ in thousands	4,139,360	3,773,770	3,496,880	2,845,090	2,499,970
Total stockholders’ equity	US$ in thousands	2,386,940	2,150,220	1,764,510	1,280,700	1,061,700
Financial leverage ratio		1.73	1.76	1.98	2.22	2.35

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,139,360K ÷ $2,386,940K
= 1.73

Century Communities Inc's financial leverage ratio has been progressively decreasing over the past five years from 2.35 in 2019 to 1.73 in 2023. This indicates that the company has been reducing its reliance on debt to finance its operations and growth, which can be seen as a positive trend as lower financial leverage ratios generally signal lower financial risk.

The declining trend in the financial leverage ratio could suggest that Century Communities Inc has been improving its financial stability and reducing the potential impact of financial distress. However, it is essential to consider that a lower leverage ratio may also limit the company's ability to take advantage of potential growth opportunities that could be financed through debt.

Overall, the decreasing financial leverage ratio of Century Communities Inc reflects a more conservative approach to financing its operations, which could lead to a more balanced capital structure and reduced financial risk in the long term.