LCI Industries (LCII)

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	2,959,320	3,033,810	3,076,400	3,209,370	3,246,910	3,268,970	3,482,700	3,640,720	3,288,090	3,088,180	2,776,180	2,500,470	2,298,030	2,110,680	2,018,270	2,051,210	1,862,600	1,414,810	1,330,220	1,342,550
Total stockholders’ equity	US$ in thousands	1,355,040	1,372,140	1,370,900	1,359,510	1,381,010	1,423,560	1,394,360	1,259,250	1,092,880	1,031,140	986,176	959,587	908,326	875,562	816,630	807,803	800,672	777,381	752,876	721,679
Financial leverage ratio		2.18	2.21	2.24	2.36	2.35	2.30	2.50	2.89	3.01	2.99	2.82	2.61	2.53	2.41	2.47	2.54	2.33	1.82	1.77	1.86

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,959,320K ÷ $1,355,040K
= 2.18

The financial leverage ratio of LCI Industries has been fluctuating over the past eight quarters. The ratio ranged from a low of 2.18 in Q4 2023 to a high of 2.89 in Q1 2022. Overall, the trend shows an increasing pattern from Q1 2022 to Q1 2023, where the financial leverage ratio steadily rose from 2.50 to 2.36. However, in the most recent quarters, the ratio has started to decline again, dropping from 2.36 in Q1 2023 to 2.18 in Q4 2023.

A financial leverage ratio above 1 indicates that the company relies more on debt financing rather than equity financing. LCI Industries has consistently maintained a financial leverage ratio above 2, suggesting a higher proportion of debt in its capital structure compared to equity. This indicates a higher degree of financial risk associated with the company, as higher leverage can amplify both returns and losses.

The fluctuations in the financial leverage ratio of LCI Industries over the past quarters may indicate changes in the company's capital structure and financing decisions. It would be important to monitor future trends in the financial leverage ratio to assess the company's ability to manage its debt levels effectively and sustain its financial health.