Choice Hotels International Inc (CHH)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,394,800 | 2,102,180 | 1,931,820 | 1,587,330 | 1,386,670 |
| Total stockholders’ equity | US$ in thousands | 35,598 | 154,660 | 265,882 | -5,752 | -23,511 |
| Financial leverage ratio | 67.27 | 13.59 | 7.27 | — | — |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,394,800K ÷ $35,598K
= 67.27
Choice Hotels International Inc's financial leverage ratio has experienced a significant increase over the years, reaching 67.27% at the end of 2023 from 13.59% in 2022 and 7.27% in 2021. This suggests that the company has been relying more on debt to finance its operations and investments. The sharp increase in the financial leverage ratio may indicate a possible shift in the company's capital structure towards a higher level of debt, which could pose risks in terms of financial stability and solvency. Further analysis of the company's debt levels and ability to service its debt obligations would be necessary to assess the implications of this trend.
Peer comparison
Dec 31, 2023