Goodyear Tire & Rubber Co (GT)
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 | 21,582,000 | 22,499,000 | 22,814,000 | 23,171,000 | 22,431,000 | 23,378,000 | 22,901,000 | 22,622,000 | 21,402,000 | 21,617,000 | 21,180,000 | 16,569,000 | 16,506,000 | 16,192,000 | 15,827,000 | 16,691,000 | 17,185,000 | 18,299,000 | 18,470,000 | 18,273,000 |
| Total stockholders’ equity | US$ in thousands | 4,668,000 | 4,993,000 | 5,105,000 | 5,253,000 | 5,300,000 | 5,087,000 | 5,174,000 | 5,145,000 | 4,999,000 | 4,314,000 | 4,212,000 | 3,106,000 | 3,078,000 | 2,860,000 | 2,833,000 | 3,510,000 | 4,351,000 | 4,835,000 | 4,847,000 | 4,808,000 |
| Financial leverage ratio | 4.62 | 4.51 | 4.47 | 4.41 | 4.23 | 4.60 | 4.43 | 4.40 | 4.28 | 5.01 | 5.03 | 5.33 | 5.36 | 5.66 | 5.59 | 4.76 | 3.95 | 3.78 | 3.81 | 3.80 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $21,582,000K ÷ $4,668,000K
= 4.62
The financial leverage ratio of Goodyear Tire & Rubber Co. has been fluctuating over the past eight quarters, ranging from 4.23 to 4.62. This ratio indicates that the company relies more on debt financing rather than equity to fund its operations and investments. A higher financial leverage ratio suggests a higher level of financial risk and potential volatility in earnings.
The upward trend in the financial leverage ratio from Q4 2022 to Q4 2023 indicates an increasing reliance on debt to finance the company's activities during this period. The spike to 4.62 in Q4 2023 suggests a significant surge in debt compared to previous quarters.
It is important for investors and stakeholders to monitor this trend closely as a high financial leverage ratio can impact a company's financial stability and ability to meet its debt obligations, especially in times of economic downturns or unfavorable market conditions. Further analysis of the company's debt structure and debt management strategies would provide more insights into its financial health and risk profile.