First Solar Inc (FSLR)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 10,365,100 | 8,251,230 | 7,413,750 | 7,108,930 | 7,515,690 |
| Total stockholders’ equity | US$ in thousands | 6,687,470 | 5,836,060 | 5,959,550 | 5,520,930 | 5,096,770 |
| Financial leverage ratio | 1.55 | 1.41 | 1.24 | 1.29 | 1.47 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $10,365,100K ÷ $6,687,470K
= 1.55
The financial leverage ratio of First Solar Inc has shown fluctuations over the past five years. The ratio increased from 1.29 in 2020 to 1.55 in 2023, indicating an increase in the company's reliance on debt to finance its operations and investments. This may suggest a higher level of financial risk as the company has a higher proportion of debt in its capital structure.
The ratio was relatively stable between 2021 and 2022 at 1.24 and 1.41, respectively, before experiencing a significant increase in 2023. This rise in the financial leverage ratio could potentially be a result of the company taking on additional debt to fund expansion projects or other strategic initiatives.
In comparison to 2019, where the ratio stood at 1.47, the current ratio of 1.55 in 2023 indicates a slightly higher level of leverage. It is important for investors and stakeholders to closely monitor this trend to assess the company's ability to manage its debt obligations effectively and ensure sustainable growth in the long term.
Peer comparison
Dec 31, 2023