Illumina Inc (ILMN)

Financial leverage ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Total assets	US$ in thousands	10,111,000	12,252,000	15,217,000	7,585,000	7,316,000
Total stockholders’ equity	US$ in thousands	5,745,000	6,599,000	10,740,000	4,694,000	4,613,000
Financial leverage ratio		1.76	1.86	1.42	1.62	1.59

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $10,111,000K ÷ $5,745,000K
= 1.76

The financial leverage ratio of Illumina Inc has fluctuated over the past five years, ranging from 1.42 to 1.86. The ratio indicates the company's level of debt relative to its equity, with a higher ratio suggesting higher financial leverage and potentially higher financial risk.

In 2023, the financial leverage ratio decreased to 1.76 from 1.86 in the previous year, signaling a slight reduction in the company's reliance on debt to finance its operations. This could indicate a more conservative approach to capital structure. Compared to 2022, the current ratio is higher, suggesting that Illumina has increased its equity base relative to debt.

However, it's important to note that the financial leverage ratio is still higher than in 2021 and 2019. This trend indicates that Illumina has been gradually increasing its debt levels relative to equity over the years, which may raise concerns about the company's financial stability and ability to manage debt repayment obligations in the long term.

Overall, the company's financial leverage ratio trend suggests a dynamic capital structure strategy that has evolved over the years, with a recent slight reduction in reliance on debt. Investors and stakeholders should continue to monitor Illumina's financial leverage and debt management practices to understand its overall financial health.