Mercury Systems Inc (MRCY)
Financial leverage ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,378,900 | 2,391,370 | 2,304,420 | 1,955,140 | 1,610,720 |
| Total stockholders’ equity | US$ in thousands | 1,472,780 | 1,566,680 | 1,537,180 | 1,484,150 | 1,384,780 |
| Financial leverage ratio | 1.62 | 1.53 | 1.50 | 1.32 | 1.16 |
June 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,378,900K ÷ $1,472,780K
= 1.62
The financial leverage ratio of Mercury Systems Inc has been gradually increasing over the past five years, indicating an upward trend in the company's leverage levels. This ratio has moved from 1.16 in Jun 30, 2020, to 1.62 in Jun 30, 2024.
A financial leverage ratio above 1 suggests that the company relies more on debt financing rather than equity to fund its operations and investments. A higher financial leverage ratio may magnify returns on equity when the company is performing well, but it also increases the risk of financial distress during economic downturns.
Mercury Systems Inc's increasing financial leverage ratio could be a signal of the company taking on more debt to finance its growth or investments. It is essential for stakeholders to monitor this trend to ensure that the company maintains a healthy balance between debt and equity to support its long-term financial stability.
Peer comparison
Jun 30, 2024