Newmont Goldcorp Corp (NEM)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 55,506,000 | 38,482,000 | 40,564,000 | 41,369,000 | 39,974,000 |
| Total stockholders’ equity | US$ in thousands | 29,027,000 | 19,354,000 | 22,022,000 | 23,008,000 | 21,420,000 |
| Financial leverage ratio | 1.91 | 1.99 | 1.84 | 1.80 | 1.87 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $55,506,000K ÷ $29,027,000K
= 1.91
The financial leverage ratio of Newmont Corp has shown some fluctuations over the past five years. In 2023, the ratio decreased slightly to 1.91 from 1.99 in 2022. This indicates that the company is relying less on debt to finance its operations compared to the previous year. However, when compared to 2021 and 2020, the ratio is still higher, suggesting that the company has been taking on more debt in recent years.
It is important to note that a financial leverage ratio above 1 indicates that the company has more debt than equity in its capital structure. While this can amplify returns in good times, it also increases the financial risk faced by the company, especially during challenging economic conditions.
Overall, Newmont Corp's financial leverage ratio has been fluctuating but generally trending higher in recent years, indicating a potential increase in financial risk and highlighting the importance of closely monitoring the company's debt levels and ability to repay its obligations.