NewJersey Resources Corporation (NJR)

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	6,749,050	6,537,500	6,312,580	6,296,130	6,610,090	6,261,420	6,161,920	5,870,000	5,981,160	5,722,280	5,408,620	5,425,130	5,396,900	5,316,480	5,282,080	5,155,200	5,095,170	4,157,940	4,123,410	4,089,970
Total stockholders’ equity	US$ in thousands	2,066,200	1,990,740	1,995,240	2,000,840	1,922,800	1,817,210	1,768,680	1,784,290	1,716,980	1,630,860	1,682,070	1,821,830	1,698,210	1,643,900	1,612,480	1,654,740	1,608,090	1,381,830	1,572,200	1,569,160
Financial leverage ratio		3.27	3.28	3.16	3.15	3.44	3.45	3.48	3.29	3.48	3.51	3.22	2.98	3.18	3.23	3.28	3.12	3.17	3.01	2.62	2.61

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $6,749,050K ÷ $2,066,200K
= 3.27

The financial leverage ratio of New Jersey Resources Corporation has been fluctuating over the past eight quarters, ranging from a low of 3.15 in Q2 2023 to a high of 3.48 in Q3 2022. The ratio indicates that, on average, the company relies on debt financing to generate its operating performance and growth. A ratio higher than 3 suggests that the company has a higher proportion of debt in its capital structure compared to equity. This could indicate potential risks related to debt servicing and financial stability, as higher leverage magnifies the impact of changes in operating income on the company's profitability and cash flow. However, the relatively stable range of the ratio in recent quarters indicates that the company has been managing its leverage within a consistent range despite minor fluctuations. Monitoring trends in this ratio is crucial for evaluating the company's financial health and risk profile.