Nordson Corporation (NDSN)
Financial leverage ratio
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 5,251,770 | 3,820,380 | 3,790,960 | 3,674,660 | 3,516,450 |
| Total stockholders’ equity | US$ in thousands | 2,598,060 | 2,294,380 | 2,159,130 | 1,758,990 | 1,581,040 |
| Financial leverage ratio | 2.02 | 1.67 | 1.76 | 2.09 | 2.22 |
October 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,251,770K ÷ $2,598,060K
= 2.02
The financial leverage ratio measures the extent to which a company relies on debt financing in relation to its equity. Nordson Corp.'s financial leverage ratio has varied over the past five years, ranging from 1.67 to 2.22. A higher ratio indicates a greater reliance on debt financing, which can increase financial risk but also potentially amplify returns. In 2023, Nordson Corp.'s financial leverage ratio increased to 2.02 from 1.67 in 2022, suggesting a higher reliance on debt compared to the previous year. This may indicate a strategic shift in the company's capital structure or investment in growth opportunities. It's important for stakeholders to monitor the trend in the financial leverage ratio to assess the company's risk profile and financial stability.
Peer comparison
Oct 31, 2023