Gilead Sciences Inc (GILD)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 58,995,000 | 62,125,000 | 63,171,000 | 67,952,000 | 68,407,000 |
| Total stockholders’ equity | US$ in thousands | 19,330,000 | 22,833,000 | 21,209,000 | 21,064,000 | 18,221,000 |
| Financial leverage ratio | 3.05 | 2.72 | 2.98 | 3.23 | 3.75 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $58,995,000K ÷ $19,330,000K
= 3.05
The financial leverage ratio of Gilead Sciences Inc has shown a downward trend over the five-year period from 2020 to 2024. The ratio decreased from 3.75 in December 31, 2020, to 3.23 in December 31, 2021, and continued to decline to 2.98 in December 31, 2022, further dropping to 2.72 in December 31, 2023. However, there was a slight increase to 3.05 in December 31, 2024.
The decreasing trend in the financial leverage ratio indicates that Gilead Sciences Inc has been reducing its reliance on debt to finance its operations and investments over the years. A lower financial leverage ratio signifies that the company is relying more on equity financing rather than debt financing, which can be considered a positive indication of financial stability and lower financial risk.
It is important to note that while a decreasing trend in the financial leverage ratio can be favorable in terms of financial risk management, it is also essential to strike a balance between debt and equity financing to ensure optimal capital structure that maximizes returns for shareholders while maintaining financial flexibility for future growth and investment opportunities.
Peer comparison
Dec 31, 2024