Encompass Health Corp (EHC)
Financial leverage ratio
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | 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 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 6,534,700 | 6,458,400 | 6,388,700 | 6,231,400 | 6,102,400 | 5,964,300 | 5,860,900 | 5,747,300 | 5,636,500 | 5,475,900 | 7,082,200 | 6,944,000 | 6,864,900 | 6,721,700 | 6,612,900 | 6,542,200 | 6,445,900 | 6,610,500 | 6,502,500 | 6,137,700 |
| Total stockholders’ equity | US$ in thousands | 2,792,700 | 1,959,800 | 1,839,400 | 1,741,900 | 1,647,500 | 1,560,400 | 1,475,300 | 1,383,500 | 1,310,300 | 1,217,000 | 2,003,000 | 1,973,500 | 1,911,300 | 1,842,700 | 1,762,000 | 1,655,100 | 1,588,000 | 1,520,800 | 1,462,800 | 1,443,900 |
| Financial leverage ratio | 2.34 | 3.30 | 3.47 | 3.58 | 3.70 | 3.82 | 3.97 | 4.15 | 4.30 | 4.50 | 3.54 | 3.52 | 3.59 | 3.65 | 3.75 | 3.95 | 4.06 | 4.35 | 4.45 | 4.25 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $6,534,700K ÷ $2,792,700K
= 2.34
Encompass Health Corp's financial leverage ratio has shown a decreasing trend over the period from March 31, 2020, to December 31, 2024. The ratio started at 4.25 in March 2020 and steadily declined to 2.34 by December 2024. This indicates that the company has been reducing its reliance on debt to finance its operations and growth.
A financial leverage ratio above 1 implies that the company is mainly funded by debt, while a ratio below 1 signifies a lower reliance on debt and a stronger equity position. Encompass Health Corp's decreasing trend in the financial leverage ratio suggests that the company has been effectively managing its debt levels and improving its financial structure over the years.
It is important to note that a lower financial leverage ratio can indicate a lower risk of financial distress, as the company is less vulnerable to fluctuations in interest rates or economic conditions that could impact its ability to meet debt obligations. Overall, the downward trend in Encompass Health Corp's financial leverage ratio reflects a positive shift towards a more sustainable and stable financial position.
Peer comparison
Dec 31, 2024