Johnson Controls International PLC (JCI)
Financial leverage ratio
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 42,695,000 | 42,242,000 | 42,158,000 | 41,890,000 | 40,815,000 |
| Total stockholders’ equity | US$ in thousands | 16,098,000 | 16,545,000 | 16,268,000 | 17,562,000 | 17,447,000 |
| Financial leverage ratio | 2.65 | 2.55 | 2.59 | 2.39 | 2.34 |
September 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $42,695,000K ÷ $16,098,000K
= 2.65
The financial leverage ratio of Johnson Controls International PLC has shown a fluctuating trend over the past five years, ranging from 2.34 to 2.65. The ratio indicates the proportion of the company's total assets that are financed through debt, with the remaining portion financed through equity.
A higher financial leverage ratio suggests that the company relies more on debt financing, which can potentially magnify returns but also increase financial risk. Conversely, a lower ratio indicates a more conservative capital structure with a greater reliance on equity financing.
In this case, the trend indicates an overall increase in the financial leverage ratio from 2.34 in 2020 to 2.65 in 2024, with some fluctuations in between. This upward trend could imply that the company has been increasing its debt relative to equity in recent years, potentially taking on more financial risk. It is important for investors and stakeholders to monitor this trend closely to assess the company's ability to meet its debt obligations and manage financial risks effectively.
Peer comparison
Sep 30, 2024