Hayward Holdings Inc (HAYW)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|
| Total assets | US$ in thousands | 2,946,280 | 2,875,010 | 2,978,470 |
| Total stockholders’ equity | US$ in thousands | 1,311,460 | 1,223,030 | 1,369,510 |
| Financial leverage ratio | 2.25 | 2.35 | 2.17 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,946,280K ÷ $1,311,460K
= 2.25
Hayward Holdings Inc's financial leverage ratio has displayed some fluctuations over the past three years. The ratio was 2.35 at the end of 2022, indicating a slightly higher level of financial leverage compared to the industry average. However, by the end of 2023, the financial leverage ratio decreased to 2.25, reflecting a modest improvement in the company's leverage position.
It is important to note that a financial leverage ratio above 1 suggests that the company relies more on debt financing than equity, which can magnify returns but also increase financial risk. In Hayward Holdings Inc's case, the ratio has been above 2 in the last two years, signifying a relatively high level of debt in the company's capital structure.
Overall, while the decreasing trend in the financial leverage ratio from 2022 to 2023 is a positive sign as it indicates a slightly reduced reliance on debt, the company should continue to monitor and manage its leverage levels effectively to ensure a healthy balance between debt and equity in its capital structure.
Peer comparison
Dec 31, 2023