Monolithic Power Systems Inc (MPWR)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,434,350 | 2,058,880 | 1,585,820 | 1,208,490 | 956,375 |
| Total stockholders’ equity | US$ in thousands | 2,049,940 | 1,668,600 | 1,243,980 | 966,587 | 773,491 |
| Financial leverage ratio | 1.19 | 1.23 | 1.27 | 1.25 | 1.24 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,434,350K ÷ $2,049,940K
= 1.19
The financial leverage ratio of Monolithic Power System Inc has been consistently decreasing over the past five years. This indicates that the company's reliance on debt to finance its operations has been gradually decreasing. A lower financial leverage ratio is generally considered favorable as it suggests lower financial risk and greater financial stability. Monolithic Power System Inc's decreasing trend in financial leverage ratio from 1.27 in 2021 to 1.19 in 2023 reflects a strengthening financial position and a reduced dependence on debt for funding its activities over the years. This could potentially result in improved creditworthiness and better performance in the long term.
Peer comparison
Dec 31, 2023