Guess? Inc. (GES)
Financial leverage ratio
| Jan 31, 2025 | Feb 3, 2024 | Jan 31, 2024 | Jan 31, 2023 | Jan 28, 2023 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,766,680 | 2,590,020 | 2,590,020 | 2,425,450 | 2,425,450 |
| Total stockholders’ equity | US$ in thousands | 550,407 | 684,940 | 684,940 | 534,113 | 534,113 |
| Financial leverage ratio | 5.03 | 3.78 | 3.78 | 4.54 | 4.54 |
January 31, 2025 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,766,680K ÷ $550,407K
= 5.03
The financial leverage ratio of Guess? Inc. has shown some fluctuations over the years. The ratio was 4.54 as of January 28, 2023, remained the same on January 31, 2023, and then decreased to 3.78 on January 31, 2024, maintaining this level until February 3, 2024. However, there was an increase in the financial leverage ratio to 5.03 as of January 31, 2025.
The financial leverage ratio indicates the extent to which a company is using debt to finance its operations. A higher ratio suggests that a company is relying more on debt, which may lead to higher financial risk but can also amplify returns on equity. On the other hand, a lower ratio implies less dependency on debt for operations.
Guess? Inc. experienced a decrease in its financial leverage ratio from 4.54 to 3.78 before a subsequent increase to 5.03, indicating changes in its debt levels and capital structure over the years. It is crucial for the company to carefully manage its debt levels to maintain financial stability and profitability in the long term.