Southwest Airlines Company (LUV)
Financial leverage ratio
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 33,750,000 | 34,847,000 | 35,563,000 | 36,018,000 | 36,487,000 | 36,980,000 | 36,519,000 | 35,546,000 | 35,369,000 | 35,946,000 | 38,302,000 | 37,262,000 | 36,320,000 | 37,110,000 | 38,206,000 | 35,493,000 | 34,588,000 | 35,605,000 | 35,596,000 | 26,885,000 |
| Total stockholders’ equity | US$ in thousands | 10,350,000 | 10,411,000 | 10,465,000 | 10,196,000 | 10,515,000 | 11,054,000 | 10,789,000 | 10,302,000 | 10,687,000 | 10,924,000 | 11,120,000 | 10,417,000 | 10,414,000 | 10,250,000 | 9,688,000 | 9,093,000 | 8,876,000 | 9,769,000 | 10,878,000 | 9,075,000 |
| Financial leverage ratio | 3.26 | 3.35 | 3.40 | 3.53 | 3.47 | 3.35 | 3.38 | 3.45 | 3.31 | 3.29 | 3.44 | 3.58 | 3.49 | 3.62 | 3.94 | 3.90 | 3.90 | 3.64 | 3.27 | 2.96 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $33,750,000K ÷ $10,350,000K
= 3.26
The financial leverage ratio of Southwest Airlines Company has fluctuated over the years, ranging from a low of 2.96 in March 2020 to a high of 3.94 in June 2021. This ratio represents the company's level of debt relative to its equity, indicating the extent to which the company is using debt to finance its operations.
The trend in Southwest Airlines' financial leverage ratio shows an overall increase from 2020 to 2021, peaking in June 2021, and then gradually decreasing through 2024. This indicates that the company initially relied more on debt financing but has been reducing its leverage over time.
The ratio remained relatively stable in the most recent periods, ranging between 3.26 and 3.53. A financial leverage ratio of around 3.5 means that for every dollar of equity, the company has about $3.50 of debt. This suggests that Southwest Airlines continues to maintain a moderate level of leverage, balancing the use of debt to support growth and operations while keeping leverage at manageable levels.
Peer comparison
Dec 31, 2024