Compass Minerals International Inc (CMP)

Financial leverage ratio

		Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Total assets	US$ in thousands	1,652,100	1,805,300	1,818,000	1,732,600	1,784,700	1,764,700	1,643,500	1,577,000	1,647,200	1,693,100	1,972,500	668,300	2,261,500	2,157,800	2,085,800	2,110,800	2,443,200	2,329,800	2,320,900	2,308,600
Total stockholders’ equity	US$ in thousands	387,700	459,800	517,200	536,700	485,400	509,800	256,400	300,900	286,500	288,000	186,600	123,800	378,300	319,900	333,300	355,700	517,700	459,500	522,900	538,800
Financial leverage ratio		4.26	3.93	3.52	3.23	3.68	3.46	6.41	5.24	5.75	5.88	10.57	5.40	5.98	6.75	6.26	5.93	4.72	5.07	4.44	4.28

March 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,652,100K ÷ $387,700K
= 4.26

The financial leverage ratio of Compass Minerals International Inc has shown fluctuations over the past few quarters. The ratio has ranged from a low of 3.23 to a high of 10.57, with an average value of approximately 5.43 during this period. The ratio peaked in the second quarter of 2022 at 10.57, indicating a higher level of leverage compared to other quarters.

A financial leverage ratio above 1 indicates that the company is relying more on debt to finance its operations, while a ratio below 1 suggests a more conservative capital structure. Compass Minerals International Inc's ratio has generally been above 1, indicating a higher reliance on debt financing. However, the fluctuating nature of the ratio suggests varying levels of indebtedness and financial risk over time.

Investors and stakeholders should closely monitor changes in the financial leverage ratio to assess the company's ability to meet its debt obligations and manage financial risk effectively. It would be prudent for the company to maintain a balance between debt and equity financing to ensure sustainable growth and financial stability.