Corning Incorporated (GLW)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 28,500,000 | 29,499,000 | 30,154,000 | 30,775,000 | 28,898,000 |
| Total stockholders’ equity | US$ in thousands | 11,551,000 | 12,008,000 | 12,333,000 | 13,257,000 | 12,907,000 |
| Financial leverage ratio | 2.47 | 2.46 | 2.44 | 2.32 | 2.24 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $28,500,000K ÷ $11,551,000K
= 2.47
The financial leverage ratio of Corning, Inc. has shown a consistent increasing trend over the past five years, indicating a gradual rise in the company's level of financial leverage. The ratio increased from 2.24 in 2019 to 2.47 in 2023. This suggests that the company has been relying more on debt to finance its operations and investments in recent years.
A financial leverage ratio above 1 implies that the company has more debt than equity in its capital structure. While debt can be used to magnify returns, it also increases financial risk as the company has to meet interest payments and repay principal amounts. Therefore, investors and creditors may scrutinize the increasing leverage ratio as it could signify heightened financial risk for the company.
It is essential for Corning, Inc. to carefully manage its debt levels to ensure solvency and stability in the long term. A high financial leverage ratio can potentially limit the company's financial flexibility and impact its creditworthiness. Monitoring this ratio and its trend over time is crucial for stakeholders to assess the company's financial health and risk profile.
Peer comparison
Dec 31, 2023