Donaldson Company Inc (DCI)

Financial leverage ratio

		Jul 31, 2024	Apr 30, 2024	Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020	Jan 31, 2020	Oct 31, 2019
Total assets	US$ in thousands	2,914,300	2,866,100	2,783,500	2,768,600	2,770,500	2,675,500	2,578,600	2,512,000	2,600,300	2,519,200	2,491,300	2,438,500	2,400,200	2,354,600	2,271,100	2,269,400	2,244,600	2,338,500	2,262,200	2,283,300
Total stockholders’ equity	US$ in thousands	1,489,100	1,484,000	1,375,800	1,336,100	1,320,700	1,298,700	1,194,200	1,154,800	1,133,200	1,123,600	1,116,800	1,115,900	1,137,100	1,153,400	1,074,400	1,052,600	992,900	944,500	940,400	917,000
Financial leverage ratio		1.96	1.93	2.02	2.07	2.10	2.06	2.16	2.18	2.29	2.24	2.23	2.19	2.11	2.04	2.11	2.16	2.26	2.48	2.41	2.49

July 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,914,300K ÷ $1,489,100K
= 1.96

The financial leverage ratio of Donaldson Company Inc has exhibited some fluctuations over the past several quarters. The ratio has generally been on an upward trend since the beginning of 2020, reaching a peak of 2.49 in October 2019. However, there have been periods of slight decreases in the ratio, notably in the most recent quarter, July 2024, where the ratio decreased to 1.96.

A financial leverage ratio above 1 indicates that the company is relying more on debt to finance its operations than equity. Donaldson Company's ratio consistently above 2 suggests that the company has a higher level of debt relative to equity, indicating a higher financial risk. It is crucial for investors and stakeholders to monitor the trend of the financial leverage ratio to assess the company's financial stability and risk profile over time.