National Vision Holdings Inc (EYE)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,172,510 | 2,291,250 | 2,293,090 | 2,333,500 | 2,032,720 |
| Total stockholders’ equity | US$ in thousands | 829,418 | 901,113 | 925,980 | 906,502 | 776,437 |
| Financial leverage ratio | 2.62 | 2.54 | 2.48 | 2.57 | 2.62 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,172,510K ÷ $829,418K
= 2.62
The financial leverage ratio of National Vision Holdings Inc has been fluctuating over the past five years, ranging from 2.48 to 2.62. The formula for this ratio is total assets divided by shareholders' equity. A ratio above 1 indicates that the company has more debt than equity in its capital structure.
In the case of National Vision Holdings Inc, the increasing trend in the financial leverage ratio from 2.48 in 2021 to 2.62 in 2019 suggests that the company has been relying more on debt to finance its operations and investments compared to equity. This may indicate a higher level of financial risk as the company has taken on a larger proportion of debt relative to its equity.
It is important for investors and stakeholders to monitor this ratio closely as a high financial leverage ratio can make the company vulnerable to fluctuations in interest rates and potentially impact its ability to meet its financial obligations. Additionally, it could also indicate a lower level of financial flexibility and a higher reliance on external financing.
Peer comparison
Dec 31, 2023