Grand Canyon Education Inc (LOPE)

Financial leverage ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Total assets	US$ in thousands	930,463	832,749	1,222,740	1,844,580	1,690,290
Total stockholders’ equity	US$ in thousands	718,014	637,619	1,045,050	1,574,330	1,443,430
Financial leverage ratio		1.30	1.31	1.17	1.17	1.17

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $930,463K ÷ $718,014K
= 1.30

The financial leverage ratio of Grand Canyon Education Inc has exhibited fluctuations over the five-year period from 2019 to 2023. The ratio stood at 1.30 in 2023, slightly lower than the previous year's ratio of 1.31. It is noteworthy that there was a significant increase in the ratio from 2019 to 2021, rising from 1.17 to 1.30, before stabilizing at 1.17 in the subsequent years.

A financial leverage ratio above 1 indicates that the company relies more on debt financing than equity financing. The slight decrease in the ratio from 2022 to 2023 suggests a potential reduction in the company's reliance on debt to finance its operations. However, further analysis is required to understand the factors driving these changes and their implications for the company's financial health and stability.

It is essential for stakeholders to closely monitor the trend of the financial leverage ratio and assess its impact on the company's risk profile, liquidity, and overall financial performance.