Eastman Chemical Company (EMN)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 15,213,000 | 14,633,000 | 14,667,000 | 15,519,000 | 16,083,000 |
| Total stockholders’ equity | US$ in thousands | 5,779,000 | 5,458,000 | 5,153,000 | 5,704,000 | 6,023,000 |
| Financial leverage ratio | 2.63 | 2.68 | 2.85 | 2.72 | 2.67 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $15,213,000K ÷ $5,779,000K
= 2.63
The financial leverage ratio for Eastman Chemical Company has shown a slight upward trend from 2.67 in December 2020 to 2.85 in December 2022, before decreasing to 2.63 by December 2024. This metric indicates that the company's reliance on debt to finance its operations and growth has fluctuated over the years. A higher financial leverage ratio suggests a higher level of debt compared to equity in the company's capital structure, which can amplify returns on equity in good times but also increase financial risk in downturns. The recent decrease in the ratio may indicate a reduction in debt relative to equity, potentially improving the company's financial stability and risk profile. However, further analysis of the company's overall financial health and debt management strategies would be necessary to assess the impact of these changes on its long-term performance.
Peer comparison
Dec 31, 2024