Leggett & Platt Incorporated (LEG)
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 | 4,634,500 | 5,077,600 | 5,144,300 | 5,270,000 | 5,186,100 | 5,175,200 | 5,230,600 | 5,341,800 | 5,307,300 | 5,235,100 | 5,150,100 | 4,911,600 | 4,800,000 | 4,663,800 | 4,582,100 | 4,982,000 | 4,855,400 | 4,857,800 | 5,002,000 | 4,953,800 |
| Total stockholders’ equity | US$ in thousands | 1,333,300 | 1,635,100 | 1,668,000 | 1,666,500 | 1,640,700 | 1,562,200 | 1,614,000 | 1,670,800 | 1,648,000 | 1,575,800 | 1,534,200 | 1,455,700 | 1,424,600 | 1,299,500 | 1,214,200 | 1,238,200 | 1,312,000 | 1,255,200 | 1,238,200 | 1,194,700 |
| Financial leverage ratio | 3.48 | 3.11 | 3.08 | 3.16 | 3.16 | 3.31 | 3.24 | 3.20 | 3.22 | 3.32 | 3.36 | 3.37 | 3.37 | 3.59 | 3.77 | 4.02 | 3.70 | 3.87 | 4.04 | 4.15 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,634,500K ÷ $1,333,300K
= 3.48
The financial leverage ratio of Leggett & Platt, Inc. has exhibited fluctuations over the past eight quarters, ranging from 3.08 to 3.48. The ratio measures the extent to which the company relies on debt to finance its operations and growth initiatives, relative to its equity.
A higher financial leverage ratio indicates a greater reliance on debt financing, which can enhance returns but also increases financial risk. Conversely, a lower ratio suggests a more conservative capital structure with a higher proportion of equity.
The trend for Leggett & Platt's financial leverage ratio shows some variability over the quarters analyzed. The ratio peaked in Q4 2023 at 3.48, indicating a higher degree of leverage compared to the previous quarters. This increase could be due to various factors, such as strategic investments, acquisitions, or debt issuance.
On the other hand, the ratio decreased to a low of 3.08 in Q2 2023, signaling a potential reduction in debt relative to equity during that period. This could be attributed to debt repayments, improved profitability, or a shift towards equity financing.
Overall, the fluctuation in Leggett & Platt's financial leverage ratio suggests a dynamic approach to capital structure management. It is essential for investors and stakeholders to monitor these changes to assess the company's financial risk profile and evaluate its long-term sustainability and growth prospects.
Peer comparison
Dec 31, 2023