Churchill Downs Incorporated (CHDN)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 7,275,900 | 6,955,500 | 6,206,800 | 2,981,600 | 2,686,400 |
| Total stockholders’ equity | US$ in thousands | 1,083,600 | 893,600 | 551,500 | 306,800 | 367,100 |
| Financial leverage ratio | 6.71 | 7.78 | 11.25 | 9.72 | 7.32 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $7,275,900K ÷ $1,083,600K
= 6.71
To analyze Churchill Downs Incorporated's financial leverage ratio over the years, we observe that the ratio increased from 7.32 on December 31, 2020, to 9.72 on December 31, 2021, signifying a growth in the company's financial leverage. This increase continued in the following year, reaching 11.25 by December 31, 2022, indicating a higher level of debt relative to equity.
However, there was a notable decrease in the financial leverage ratio to 7.78 on December 31, 2023, suggesting a reduction in leverage or a shift towards a healthier balance between debt and equity. Subsequently, by December 31, 2024, the ratio decreased further to 6.71, showcasing a potential improvement in the company's financial position in terms of leverage.
Overall, the trend in Churchill Downs Incorporated's financial leverage ratio reflects fluctuations over the years, with periods of increasing leverage followed by periods of decline. It is essential for the company to monitor and manage its leverage effectively to maintain a sustainable capital structure and financial stability.