Murphy USA Inc (MUSA)
Financial leverage ratio
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 4,340,100 | 4,305,300 | 4,204,800 | 4,119,200 | 4,123,200 | 4,135,100 | 4,217,800 | 4,206,200 | 4,048,200 | 4,094,300 | 3,986,100 | 3,980,600 | 2,685,700 | 2,788,200 | 2,860,700 | 2,583,400 | 2,687,200 | 2,616,700 | 2,571,300 | 2,504,400 |
| Total stockholders’ equity | US$ in thousands | 828,900 | 844,100 | 750,800 | 716,800 | 640,700 | 766,000 | 762,700 | 791,500 | 807,200 | 824,800 | 757,900 | 780,600 | 784,100 | 895,700 | 918,000 | 746,800 | 803,000 | 779,000 | 816,300 | 797,800 |
| Financial leverage ratio | 5.24 | 5.10 | 5.60 | 5.75 | 6.44 | 5.40 | 5.53 | 5.31 | 5.02 | 4.96 | 5.26 | 5.10 | 3.43 | 3.11 | 3.12 | 3.46 | 3.35 | 3.36 | 3.15 | 3.14 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,340,100K ÷ $828,900K
= 5.24
The financial leverage ratio of Murphy USA Inc has shown some variability over the last eight quarters, ranging from a low of 5.10 in Q3 2023 to a high of 6.44 in Q4 2022. The trend indicates that the company's reliance on debt to finance its operations has fluctuated over time.
A higher financial leverage ratio indicates that a company has a higher proportion of debt in its capital structure compared to equity, which may increase financial risk due to the firm's obligation to pay interest and principal on the debt. Conversely, a lower ratio suggests a lower financial risk but may also reflect limited use of debt financing that could potentially limit growth opportunities.
Murphy USA Inc's recent decrease in the financial leverage ratio from 6.44 in Q4 2022 to 5.10 in Q3 2023 may suggest a shift towards a more conservative capital structure. However, the ratio increased to 5.60 in Q2 2023 before declining again in Q3 2023, indicating some fluctuation in the company's debt levels.
Overall, monitoring the financial leverage ratio along with other financial metrics is essential to assess the company's capital structure efficiency and financial risk management. A consistent and balanced approach to debt and equity financing is crucial for sustaining long-term growth and profitability.
Peer comparison
Dec 31, 2023