Helen of Troy Ltd (HELE)
Financial leverage ratio
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,838,620 | 2,952,290 | 2,901,660 | 2,872,830 | 2,913,720 | 3,129,420 | 3,225,210 | 3,144,250 | 2,823,450 | 2,487,400 | 2,400,160 | 2,348,090 | 2,263,490 | 2,311,740 | 2,174,190 | 1,975,690 | 1,903,880 | 1,791,090 | 1,775,950 | 1,702,830 |
| Total stockholders’ equity | US$ in thousands | 1,637,440 | 1,586,280 | 1,501,880 | 1,514,910 | 1,488,810 | 1,457,070 | 1,398,350 | 1,356,420 | 1,327,340 | 1,354,960 | 1,267,820 | 1,202,080 | 1,239,350 | 1,210,440 | 1,308,530 | 1,221,750 | 1,161,720 | 1,161,680 | 1,087,380 | 1,036,180 |
| Financial leverage ratio | 1.73 | 1.86 | 1.93 | 1.90 | 1.96 | 2.15 | 2.31 | 2.32 | 2.13 | 1.84 | 1.89 | 1.95 | 1.83 | 1.91 | 1.66 | 1.62 | 1.64 | 1.54 | 1.63 | 1.64 |
February 29, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,838,620K ÷ $1,637,440K
= 1.73
Helen of Troy Ltd's financial leverage ratio has shown some fluctuations over the past few years. The ratio has ranged from a low of 1.54 in May 2019 to a high of 2.32 in May 2022, indicating variability in the company's level of financial leverage during this period.
Overall, the trend in the financial leverage ratio appears to have peaked in mid-2022, after which it began to decline gradually. It decreased to 1.73 by February 2024, suggesting a potential shift towards a lower level of financial leverage compared to previous periods.
A financial leverage ratio above 1 indicates that the company relies more on debt financing than equity financing, which can magnify returns but also increase financial risk. Therefore, the decreasing trend in the ratio from its peak in mid-2022 may indicate a more conservative approach to capital structure and a reduction in financial risk for Helen of Troy Ltd.
It would be important for stakeholders and investors to monitor this ratio closely in future periods to assess the company's capital structure decisions and their impact on its financial risk profile.