Hubbell Inc (HUBB)

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	6,914,000	5,768,300	5,640,900	5,480,800	5,402,600	5,338,400	5,238,200	5,169,700	5,281,500	5,241,700	5,172,800	5,292,900	5,085,100	4,877,100	5,058,700	4,959,100	4,903,000	5,074,300	5,036,000	4,976,100
Total stockholders’ equity	US$ in thousands	2,877,000	2,739,100	2,620,700	2,472,700	2,360,900	2,318,700	2,256,900	2,213,300	2,229,800	2,168,800	2,125,700	2,082,700	2,070,000	2,016,800	1,959,900	1,914,900	1,947,100	1,903,100	1,835,900	1,808,100
Financial leverage ratio		2.40	2.11	2.15	2.22	2.29	2.30	2.32	2.34	2.37	2.42	2.43	2.54	2.46	2.42	2.58	2.59	2.52	2.67	2.74	2.75

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $6,914,000K ÷ $2,877,000K
= 2.40

The financial leverage ratio of Hubbell Inc. has shown fluctuations over the past eight quarters, ranging from 2.11 to 2.40. A financial leverage ratio of 2.40 in Q4 2023 indicates that the company is utilizing more debt relative to equity to finance its operations. This could suggest a higher level of financial risk as a higher ratio implies a greater reliance on debt financing.

In comparison, the ratios in the previous quarters have exhibited a decreasing trend from 2.29 in Q4 2022 to 2.11 in Q3 2023, before increasing again in Q4 2023. These fluctuations highlight potential shifts in the company's capital structure and financing decisions over time.

A financial leverage ratio above 2 generally indicates that the company has more debt than equity in its capital structure. While debt can offer tax advantages and boost returns on equity, it also amplifies financial risk due to interest payments and potential repayment obligations. Investors and creditors should closely monitor Hubbell Inc.'s financial leverage ratio to assess its ability to meet its debt obligations and remain financially stable in the long term.