California Water Service Group (CWT)
Financial leverage ratio
| 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 | Sep 30, 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 | 4,595,530 | 4,041,360 | 3,990,200 | 3,886,860 | 4,264,810 | 3,806,400 | 3,682,750 | 3,639,240 | 3,623,270 | 3,679,690 | 3,548,750 | 3,471,470 | 3,394,250 | 3,506,430 | 3,359,930 | 3,240,840 | 3,111,310 | 3,023,250 | 2,964,600 | 2,900,660 |
| Total stockholders’ equity | US$ in thousands | 1,426,730 | 1,410,670 | 1,389,520 | 1,298,200 | 1,317,590 | 1,273,460 | 1,202,520 | 1,164,630 | 1,177,590 | 1,115,970 | 997,118 | 929,802 | 921,344 | 890,192 | 782,023 | 755,140 | 779,906 | 757,795 | 723,164 | 714,129 |
| Financial leverage ratio | 3.22 | 2.86 | 2.87 | 2.99 | 3.24 | 2.99 | 3.06 | 3.12 | 3.08 | 3.30 | 3.56 | 3.73 | 3.68 | 3.94 | 4.30 | 4.29 | 3.99 | 3.99 | 4.10 | 4.06 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,595,530K ÷ $1,426,730K
= 3.22
The financial leverage ratio of California Water Service Group has shown fluctuations over the past eight quarters. The ratio ranged from a low of 2.86 in Q3 2023 to a high of 3.22 in Q4 2023. This indicates that the company's financial leverage, or the proportion of debt in its capital structure, has been varying.
A ratio above 1 indicates that the company has more debt than equity in its capital structure. A higher financial leverage ratio suggests higher financial risk as the company relies more on debt financing, which can lead to increased interest payments and potential financial distress in times of economic uncertainty.
The company's financial leverage ratios have generally been above 2.9 over the past eight quarters, indicating a significant reliance on debt to finance its operations and investments. It is noteworthy that the ratio has been relatively stable around this level with slight fluctuations.
Investors and creditors typically assess a company's financial leverage ratio to evaluate its ability to meet its debt obligations and manage financial risks effectively. The trend in California Water Service Group's financial leverage ratio reflects the company's financing strategy and its exposure to the risks associated with debt financing.
Peer comparison
Dec 31, 2023