The Chefs Warehouse Inc (CHEF)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 1,705,310 | 1,509,300 | 1,073,800 | 974,325 | 1,013,680 |
| Total stockholders’ equity | US$ in thousands | 454,672 | 401,509 | 350,211 | 344,590 | 335,933 |
| Financial leverage ratio | 3.75 | 3.76 | 3.07 | 2.83 | 3.02 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,705,310K ÷ $454,672K
= 3.75
The financial leverage ratio of The Chefs Warehouse Inc has shown a varying trend over the past five years. The ratio stood at 3.02 in 2019, increased to 3.07 in 2021, and then further rose to 3.76 in 2022. However, in the most recent year available, the ratio decreased slightly to 3.75 in 2023.
A financial leverage ratio above 1 indicates that the company relies more on debt financing than equity financing. Hence, the trend of increasing ratio from 2019 to 2022 suggests that The Chefs Warehouse Inc has been increasingly leveraging debt to finance its operations, projects, or acquisitions during this period.
The ratio peaking in 2022 and subsequently decreasing in 2023 implies a potential shift in the company's capital structure strategy, possibly towards reducing debt levels or increasing equity investment.
Overall, the financial leverage ratio trend indicates fluctuations in the company's debt-to-equity mix over the years, which may reflect changes in the company's risk profile, financial stability, and strategic financing decisions.
Peer comparison
Dec 31, 2023