Oracle Corporation (ORCL)
Financial leverage ratio
| May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 140,976,000 | 137,082,000 | 134,324,000 | 136,662,000 | 134,384,000 | 131,620,000 | 128,469,000 | 130,309,000 | 109,297,000 | 108,644,000 | 106,897,000 | 122,924,000 | 131,107,000 | 118,109,000 | 110,014,000 | 113,546,000 | 115,438,000 | 96,704,000 | 98,443,000 | 106,229,000 |
| Total stockholders’ equity | US$ in thousands | 8,704,000 | 5,623,000 | 3,866,000 | 2,370,000 | 1,073,000 | -2,421,000 | -4,246,000 | -5,875,000 | -6,220,000 | -8,696,000 | -10,101,000 | -1,541,000 | 5,238,000 | 8,900,000 | 7,917,000 | 9,491,000 | 12,074,000 | 14,235,000 | 15,563,000 | 18,433,000 |
| Financial leverage ratio | 16.20 | 24.38 | 34.74 | 57.66 | 125.24 | — | — | — | — | — | — | — | 25.03 | 13.27 | 13.90 | 11.96 | 9.56 | 6.79 | 6.33 | 5.76 |
May 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $140,976,000K ÷ $8,704,000K
= 16.20
The financial leverage ratio of Oracle Corporation has exhibited significant fluctuations over the past few periods, indicating varying levels of leverage employed by the company.
The ratio was at its highest in May 2023, reaching 125.24, suggesting that Oracle relied heavily on debt to finance its operations and investments during that period. This exceptionally high leverage could potentially increase the financial risk for the company, as the higher the leverage, the greater the potential impact of adverse changes in the business environment.
Subsequently, there was a substantial decrease in the financial leverage ratio by November 2023 to 34.74, indicating a reduction in the company's reliance on debt financing. This shift could have been a strategic decision to decrease financial risk and improve the company's financial stability.
The leverage ratio continued to fluctuate in the following periods, with values above 20, indicating that Oracle maintained a moderate to high level of leverage compared to its equity. However, the downward trend in the ratio from May 2023 to May 2024 suggests a gradual reduction in financial leverage, which could be a positive sign for the company's financial health and risk management.
Overall, monitoring Oracle Corporation's financial leverage ratio is crucial for understanding the company's capital structure and risk profile, as changes in leverage can impact its profitability, creditworthiness, and overall financial performance.
Peer comparison
May 31, 2024