Nucor Corp (NUE)

Financial leverage ratio

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Total assets US$ in thousands 35,340,500 32,479,200 25,823,100 20,125,400 18,344,700
Total stockholders’ equity US$ in thousands 20,940,600 18,414,700 14,016,400 10,788,700 10,357,900
Financial leverage ratio 1.69 1.76 1.84 1.87 1.77

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $35,340,500K ÷ $20,940,600K
= 1.69

The financial leverage ratio of Nucor Corp. has been fluctuating over the past five years. The ratio decreased from 1.87 in 2020 to 1.69 in 2023, showing an improvement in the company's ability to meet its financial obligations with a lower level of debt. This decrease in the financial leverage ratio indicates that Nucor has been relying less on debt to finance its operations in recent years.

However, it is important to note that the ratio has not consistently decreased year over year, as there was an increase from 2021 to 2022. This could suggest that the company took on more debt or had lower equity levels during that period, potentially increasing its financial risk.

Overall, a decreasing trend in the financial leverage ratio is generally seen as positive, as it indicates a stronger financial position and lower debt burden. Nucor Corp. should continue to monitor and manage its financial leverage ratio to ensure a healthy balance between debt and equity financing.