Catalent Inc (CTLT)
Financial leverage ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 9,753,000 | 10,777,000 | 10,508,000 | 9,112,000 | 7,777,000 |
| Total stockholders’ equity | US$ in thousands | 3,604,000 | 4,611,000 | 4,775,000 | 3,915,000 | 2,899,000 |
| Financial leverage ratio | 2.71 | 2.34 | 2.20 | 2.33 | 2.68 |
June 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $9,753,000K ÷ $3,604,000K
= 2.71
The financial leverage ratio of Catalent Inc has shown fluctuating trends over the past five years. The ratio increased from 2.20 in June 2022 to 2.71 in June 2024, indicating a rise in the company's reliance on debt to finance its assets. This suggests that Catalent has been taking on more debt relative to its equity in recent years.
It is essential for investors and stakeholders to closely monitor changes in the financial leverage ratio as high levels of leverage can increase the company's financial risk and susceptibility to economic downturns. A high financial leverage ratio may also indicate that the company is more vulnerable to fluctuations in interest rates and may face challenges in meeting its debt obligations.
On the other hand, a lower financial leverage ratio can signify a more conservative capital structure, with less debt compared to equity. However, excessively low leverage may also imply underutilization of debt financing and potential missed opportunities for growth and expansion.
In conclusion, the increasing financial leverage ratio of Catalent Inc suggests a growing reliance on debt financing, which may necessitate careful monitoring of the company's debt levels and their potential impact on financial stability and performance.
Peer comparison
Jun 30, 2024