IDACORP Inc (IDA)

Financial leverage ratio

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Total assets US$ in thousands 8,475,920 7,543,260 7,210,520 7,095,240 6,641,200
Total stockholders’ equity US$ in thousands 2,907,570 2,807,240 2,668,440 2,559,980 2,464,630
Financial leverage ratio 2.92 2.69 2.70 2.77 2.69

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $8,475,920K ÷ $2,907,570K
= 2.92

The financial leverage ratio of Idacorp, Inc. has shown a fluctuating trend over the past five years. In 2023, the ratio increased to 2.92 from 2.69 in 2022, indicating that the company relied more on debt financing relative to equity. This increase in financial leverage may suggest a higher level of financial risk for the company as it becomes more leveraged.

Comparing 2023 to 2021 and 2020, where the ratios were 2.70 and 2.77 respectively, the financial leverage ratio has shown an overall upward trend in recent years. This trend could be a concern for stakeholders as higher leverage levels typically mean higher interest payments and potential financial strain in times of economic downturn.

However, when comparing 2023 to 2019 when the ratio was also 2.69, there seems to be consistency in the leverage levels over the longer term. It is important for the company to carefully manage its debt levels to ensure it can meet its financial obligations and safeguard its financial stability.