Darling Ingredients Inc (DAR)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 11,061,100 | 9,202,370 | 6,133,730 | 5,613,330 | 5,345,260 |
| Total stockholders’ equity | US$ in thousands | 4,605,430 | 3,809,020 | 3,280,960 | 2,891,910 | 2,565,820 |
| Financial leverage ratio | 2.40 | 2.42 | 1.87 | 1.94 | 2.08 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $11,061,100K ÷ $4,605,430K
= 2.40
The financial leverage ratio measures the extent to which a company relies on debt financing rather than equity to fund its operations. Looking at the trend for Darling Ingredients Inc over the past five years, we observe fluctuations in the financial leverage ratio.
In 2023, the financial leverage ratio stood at 2.40, a slight decrease from the previous year's ratio of 2.42. This indicates that for every dollar of equity, the company has $2.40 of debt, suggesting a higher reliance on debt financing compared to equity.
Comparing this with the ratios from the preceding years, we can see a gradual increase in leverage from 1.87 in 2021 to 2.08 in 2019 with fluctuations in between. This variability could indicate shifts in the company's capital structure or changes in its financing practices over the years.
Overall, the trend in Darling Ingredients Inc's financial leverage ratio suggests a fluctuating level of reliance on debt financing, which could have implications for the company's risk profile and financial stability. Further analysis of the company's debt management policies and overall financial health would provide more insight into the implications of these leverage ratios.
Peer comparison
Dec 31, 2023