Ethan Allen Interiors Inc (ETD)
Financial leverage ratio
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 737,099 | 744,917 | 745,453 | 719,895 | 683,245 |
| Total stockholders’ equity | US$ in thousands | 482,355 | 482,980 | 471,028 | 407,349 | 351,443 |
| Financial leverage ratio | 1.53 | 1.54 | 1.58 | 1.77 | 1.94 |
June 30, 2025 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $737,099K ÷ $482,355K
= 1.53
The financial leverage ratio of Ethan Allen Interiors Inc has demonstrated a consistent downward trend over the analyzed period from June 30, 2021, to June 30, 2025. Specifically, the ratio declined from 1.94 in 2021 to 1.77 in 2022, further decreasing to 1.58 in 2023, then to 1.54 in 2024, and finally reaching approximately 1.53 in 2025.
This gradual decline indicates a reduction in the company's reliance on debt financing relative to its equity base. A decreasing leverage ratio generally suggests an improving balance sheet strength, with less financial risk associated with high debt levels. Such a trend can also imply that the company has been actively deleveraging, possibly through debt repayment, equity issuance, or improved earnings that bolster equity capital.
Overall, the consistent decrease in the financial leverage ratio over these years suggests a strategic shift towards reduced financial leverage, potentially fostering greater financial stability and lower insolvency risk, while potentially impacting the company's capacity to amplify returns through leverage.
Peer comparison
Jun 30, 2025