NRG Energy Inc. (NRG)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 26,038,000 | 29,146,000 | 23,182,000 | 14,902,000 | 12,531,000 |
| Total stockholders’ equity | US$ in thousands | 2,906,000 | 3,828,000 | 3,600,000 | 1,680,000 | 1,678,000 |
| Financial leverage ratio | 8.96 | 7.61 | 6.44 | 8.87 | 7.47 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $26,038,000K ÷ $2,906,000K
= 8.96
The financial leverage ratio of NRG Energy Inc., which measures the company's use of debt to finance its operations and assets, has displayed some fluctuations over the past five years.
As of December 31, 2023, the financial leverage ratio stands at 8.96, indicating that the company relies significantly on debt financing. This represents an increase from the previous year's ratio of 7.61, suggesting a higher level of debt utilization in the current period.
Comparing the current ratio to that of previous years, we observe that it is relatively higher than the ratio recorded in 2021 (6.44) and 2019 (7.56) but lower than the exceptionally high ratio seen in 2020 (8.87). This pattern showcases some variability in NRG Energy Inc.'s debt usage over the analyzed period.
The increasing trend in the financial leverage ratio from 2021 to 2023 may indicate a strategic shift towards utilizing more debt in the company's capital structure. Investors and stakeholders should closely monitor this ratio to assess NRG Energy Inc.'s overall financial risk and the potential impact of its debt levels on the company's financial health and stability.
Peer comparison
Dec 31, 2023