Helmerich and Payne Inc (HP)
Financial leverage ratio
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 5,781,900 | 4,381,960 | 4,355,530 | 5,034,130 | 4,829,620 |
| Total stockholders’ equity | US$ in thousands | 2,917,150 | 2,771,940 | 2,765,470 | 2,912,620 | 3,318,510 |
| Financial leverage ratio | 1.98 | 1.58 | 1.57 | 1.73 | 1.46 |
September 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,781,900K ÷ $2,917,150K
= 1.98
The financial leverage ratio of Helmerich and Payne Inc has exhibited variability over the past five years. In 2024, the financial leverage ratio increased to 1.98 from 1.58 in 2023, indicating that the company's reliance on debt to finance its operations had increased significantly. This could potentially expose the company to higher financial risks due to the increased level of debt in its capital structure.
Comparing the current ratio to previous years, it is higher than the ratios of 2022 and 2021, suggesting a more aggressive use of debt financing in 2024. However, the 2024 ratio remains below the highest level observed in 2021, indicating a degree of moderation in the company's leverage compared to that period.
On the other hand, the financial leverage ratio in 2020 was lower at 1.46, indicating a lower reliance on debt compared to the most recent year. This suggests a fluctuating trend in the company's capital structure decisions over the analyzed period.
Overall, the increasing trend in the financial leverage ratio from 2020 to 2024 signifies a potential shift towards a higher debt utilization strategy by Helmerich and Payne Inc. It is essential for stakeholders to monitor this trend closely to assess the company's ability to manage its debt levels effectively and maintain financial stability in the long run.
Peer comparison
Sep 30, 2024