McCormick & Company Incorporated (MKC)
Financial leverage ratio
| Nov 30, 2024 | Nov 30, 2023 | Nov 30, 2022 | Nov 30, 2021 | Nov 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 13,070,300 | 12,862,300 | 13,124,900 | 12,905,800 | 12,089,700 |
| Total stockholders’ equity | US$ in thousands | 5,291,000 | 5,060,700 | 4,680,500 | 4,411,000 | 3,926,100 |
| Financial leverage ratio | 2.47 | 2.54 | 2.80 | 2.93 | 3.08 |
November 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $13,070,300K ÷ $5,291,000K
= 2.47
The financial leverage ratio of McCormick & Company Incorporated has shown a downward trend over the past five years, declining from 3.08 in November 30, 2020, to 2.47 in November 30, 2024. This indicates that the company has been relying less on debt financing relative to its equity to support its operations and growth.
A decreasing financial leverage ratio suggests that McCormick & Company has been effectively managing its debt levels and maintaining a stronger equity position. This can be seen as a positive sign of financial stability and reduced financial risk, as lower leverage ratios typically indicate lower exposure to potential financial distress.
Overall, the decreasing trend in the financial leverage ratio for McCormick & Company suggests a prudent capital structure management strategy and a reduced reliance on debt to fund its operations and investments.