FTI Consulting Inc (FCN)
Financial leverage ratio
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 3,325,880 | 3,318,830 | 3,246,310 | 3,100,980 | 3,241,410 | 3,082,090 | 3,003,170 | 2,949,290 | 3,100,910 | 3,006,920 | 2,938,430 | 2,778,200 | 2,777,360 | 2,794,400 | 2,704,910 | 2,637,180 | 2,783,140 | 2,690,270 | 2,571,360 | 2,464,900 |
| Total stockholders’ equity | US$ in thousands | 1,981,420 | 1,864,500 | 1,795,150 | 1,720,890 | 1,681,720 | 1,644,580 | 1,630,620 | 1,622,020 | 1,583,320 | 1,544,300 | 1,489,210 | 1,416,350 | 1,400,180 | 1,474,500 | 1,479,100 | 1,468,680 | 1,489,140 | 1,461,230 | 1,419,010 | 1,402,020 |
| Financial leverage ratio | 1.68 | 1.78 | 1.81 | 1.80 | 1.93 | 1.87 | 1.84 | 1.82 | 1.96 | 1.95 | 1.97 | 1.96 | 1.98 | 1.90 | 1.83 | 1.80 | 1.87 | 1.84 | 1.81 | 1.76 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $3,325,880K ÷ $1,981,420K
= 1.68
The financial leverage ratio of FTI Consulting Inc. has exhibited fluctuations over the past eight quarters, ranging from 1.68 to 1.93. The ratio indicates the proportion of the company's total assets that are financed by debt compared to equity. A higher ratio signifies higher financial leverage and, consequently, higher financial risk.
In this case, the trend shows a general decrease in the financial leverage ratio from Q4 2022 to Q4 2023, suggesting a gradual reduction in debt relative to equity in the company's capital structure. This could indicate improved financial stability and decreased risk for FTI Consulting Inc. over the period analyzed.
However, despite the downward trend, the ratio remains relatively high, indicating a significant reliance on debt to finance operations. It would be prudent for the company to continue monitoring and managing its leverage ratio to maintain a healthy balance between debt and equity financing and ensure sustainable growth and profitability in the long term.
Peer comparison
Dec 31, 2023