Envista Holdings Corp (NVST)
Financial leverage ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 5,350,500 | 6,605,100 | 6,587,000 | 6,574,200 | 6,876,000 |
| Total stockholders’ equity | US$ in thousands | 2,934,800 | 4,173,900 | 4,206,900 | 4,057,600 | 3,720,600 |
| Financial leverage ratio | 1.82 | 1.58 | 1.57 | 1.62 | 1.85 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,350,500K ÷ $2,934,800K
= 1.82
The financial leverage ratio of Envista Holdings Corp has shown a decreasing trend over the past five years, starting at 1.85 in December 2020 and gradually declining to 1.62 in December 2021, 1.57 in December 2022, and then slightly increasing to 1.58 in December 2023. However, by December 2024, the ratio had risen back up to 1.82.
This indicates that the company's reliance on debt to finance its operations has fluctuated over the period analyzed. A higher financial leverage ratio suggests that a company is using more debt to finance its operations, which can magnify profits but also increase financial risk. Conversely, a lower ratio indicates less reliance on debt financing, potentially reducing financial risk but also limiting potential returns.
Envista Holdings Corp should continue to monitor its financial leverage ratio to ensure a balanced capital structure that supports growth and profitability while managing risk effectively.
Peer comparison
Dec 31, 2024