Estee Lauder Companies Inc (EL)
Financial leverage ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 21,677,000 | 23,415,000 | 20,910,000 | 21,971,000 | 17,781,000 |
| Total stockholders’ equity | US$ in thousands | 5,314,000 | 5,585,000 | 5,590,000 | 6,057,000 | 3,935,000 |
| Financial leverage ratio | 4.08 | 4.19 | 3.74 | 3.63 | 4.52 |
June 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $21,677,000K ÷ $5,314,000K
= 4.08
The financial leverage ratio of Estee Lauder Companies Inc has shown fluctuations over the past five years. The ratio indicates the company's level of financial leverage or the extent to which it relies on debt financing. A higher financial leverage ratio suggests a higher proportion of debt in the company's capital structure.
In this case, the financial leverage ratio decreased from 4.52 in 2020 to 3.63 in 2021, indicating a reduction in the company's reliance on debt financing relative to equity during that period. However, the ratio then increased to 3.74 in 2022 and further to 4.19 in 2023, suggesting a trend of increasing debt compared to equity over those years.
Notably, the financial leverage ratio peaked at 4.19 in 2023 and then decreased slightly to 4.08 in 2024. This reduction may indicate a slight decrease in the company's debt relative to equity in 2024 compared to the previous year.
Overall, Estee Lauder Companies Inc's financial leverage ratio has shown volatility in the past five years, with a mix of increases and decreases. Further analysis of the company's financial statements and debt management strategies would provide additional insights into its capital structure and risk profile.
Peer comparison
Jun 30, 2024