News Corp B (NWS)
Financial leverage ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 16,684,000 | 16,921,000 | 17,221,000 | 16,771,000 | 14,261,000 |
| Total stockholders’ equity | US$ in thousands | 8,120,000 | 8,064,000 | 8,222,000 | 8,211,000 | 7,582,000 |
| Financial leverage ratio | 2.05 | 2.10 | 2.09 | 2.04 | 1.88 |
June 30, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $16,684,000K ÷ $8,120,000K
= 2.05
The financial leverage ratio of News Corp B has been relatively stable over the past five years, ranging from 1.88 to 2.10. The ratio indicates that the company's capital structure is leveraged, with the latest ratio of 2.05 suggesting that for every $1 of equity, the company has approximately $2.05 of debt.
The upward trend in the financial leverage ratio from 2020 to 2023 indicates an increase in the company's reliance on debt financing to support its operations or growth initiatives. However, the slight decrease in the ratio in 2024 compared to the prior year may suggest that the company has made efforts to moderate its debt levels.
It is important to note that while a higher financial leverage ratio can amplify returns on equity when business is good, it also raises the company's risk profile by increasing its financial leverage and interest obligations. Therefore, ongoing monitoring of the financial leverage ratio is crucial to ensure the company maintains a healthy balance between debt and equity in its capital structure.
Peer comparison
Jun 30, 2024