Kimberly-Clark Corporation (KMB)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 17,344,000 | 17,970,000 | 17,837,000 | 17,523,000 | 15,283,000 |
| Total stockholders’ equity | US$ in thousands | 915,000 | 547,000 | 514,000 | 626,000 | -33,000 |
| Financial leverage ratio | 18.96 | 32.85 | 34.70 | 27.99 | — |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $17,344,000K ÷ $915,000K
= 18.96
The financial leverage ratio of Kimberly-Clark Corp. has shown fluctuations over the past five years, ranging from 18.96 in 2023 to 34.70 in 2021. This ratio measures the extent to which the company is utilizing debt to finance its operations and growth. A higher financial leverage ratio indicates higher financial risk due to increased reliance on debt financing.
The decreasing trend from 2021 to 2023 suggests that Kimberly-Clark Corp. has been reducing its reliance on debt to support its operations. This could be a strategic move to lower financial risk and enhance the company's financial stability. However, it is essential to consider the industry norms and the company's growth plans when assessing the appropriateness of the current financial leverage level.
Overall, the declining trend in the financial leverage ratio of Kimberly-Clark Corp. indicates a positive shift towards a more conservative financial structure, which could lead to improved financial health and sustainability in the long term.
Peer comparison
Dec 31, 2023