Commercial Metals Company (CMC)

Financial leverage ratio

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Total assets	US$ in thousands	6,662,260	6,695,170	6,639,090	6,520,860	6,639,090	6,639,090	6,237,030	6,103,700	5,504,220	4,725,260	4,638,670	4,391,080	4,064,040	4,016,670	4,081,730	3,954,890	3,907,940	3,808,350	3,758,770	3,767,010
Total stockholders’ equity	US$ in thousands	4,222,450	4,229,740	4,120,870	4,023,380	3,782,960	3,584,000	3,286,200	3,141,940	2,869,720	2,485,960	2,294,880	2,156,370	2,009,260	1,934,690	1,889,200	1,800,450	1,757,840	1,701,500	1,623,860	1,564,000
Financial leverage ratio		1.58	1.58	1.61	1.62	1.75	1.85	1.90	1.94	1.92	1.90	2.02	2.04	2.02	2.08	2.16	2.20	2.22	2.24	2.31	2.41

February 29, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $6,662,260K ÷ $4,222,450K
= 1.58

The financial leverage ratio of Commercial Metals Company has shown a fluctuating trend over the past few quarters. The ratio, which measures the extent to which the company relies on debt to finance its operations, has ranged from 1.58 to 2.41 in the time period provided.

From November 2019 to May 2020, the financial leverage ratio steadily increased from 2.22 to 2.24. Subsequently, there was a significant jump to 2.31 by August 2020. The ratio continued to rise, reaching a peak of 2.41 by November 2020.

Following this peak, there was a slight decrease in the financial leverage ratio to 2.22 by May 2021. However, the ratio started to climb again, reaching 2.08 by February 2021 and then peaking at 2.04 by August 2021.

From August 2021 to May 2023, the financial leverage ratio exhibited some volatility, fluctuating between 1.90 and 2.02. Notably, the ratio decreased to 1.75 by February 2023 but began to rise again, reaching 1.62 by May 2023.

In the most recent quarters, the financial leverage ratio has stabilized within a relatively narrow range, with values around 1.58 to 1.61, suggesting a potentially more conservative approach to debt financing compared to the earlier periods of higher leverage. Overall, the varying trends in the financial leverage ratio of Commercial Metals Company indicate changes in the company's capital structure and debt management strategies over the analyzed period.