Hormel Foods Corporation (HRL)
Financial leverage ratio
| Oct 31, 2024 | Oct 27, 2024 | Oct 31, 2023 | Oct 29, 2023 | Oct 31, 2022 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 13,434,700 | 13,434,700 | 13,448,800 | 13,448,800 | 13,306,900 |
| Total stockholders’ equity | US$ in thousands | 7,993,420 | 7,993,420 | 7,734,880 | 7,734,880 | 7,535,280 |
| Financial leverage ratio | 1.68 | 1.68 | 1.74 | 1.74 | 1.77 |
October 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $13,434,700K ÷ $7,993,420K
= 1.68
The financial leverage ratio of Hormel Foods Corporation indicates a trend of declining leverage over the period from October 31, 2022, to October 31, 2024. The ratio decreased from 1.77 in October 2022 to 1.68 in both October 27, 2024, and October 31, 2024. This implies that the company is relying less on debt to finance its operations and investments. A lower financial leverage ratio suggests a lower level of financial risk and greater financial stability, as the company has a lower proportion of debt in its capital structure compared to equity. Overall, the decreasing trend in the financial leverage ratio is a positive indicator of the company's financial health and prudent financial management.