Paycom Soft (PAYC)

Financial leverage ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Total assets	US$ in thousands	4,197,540	3,856,100	3,951,340	4,241,620	3,902,510	3,314,570	4,891,700	5,444,570	3,215,140	4,218,040	3,233,090	3,406,770	2,607,910	2,485,200	1,921,500	2,309,720	2,486,920	1,592,030	1,826,190	2,062,830
Total stockholders’ equity	US$ in thousands	1,303,040	1,421,310	1,406,680	1,334,470	1,182,610	1,076,380	994,139	1,009,020	893,714	825,341	792,256	745,476	655,643	632,399	585,853	599,788	526,628	474,898	434,762	398,553
Financial leverage ratio		3.22	2.71	2.81	3.18	3.30	3.08	4.92	5.40	3.60	5.11	4.08	4.57	3.98	3.93	3.28	3.85	4.72	3.35	4.20	5.18

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,197,540K ÷ $1,303,040K
= 3.22

The financial leverage ratio for Paycom Software Inc has shown fluctuations over the past eight quarters, ranging from 2.71 to 5.40. The ratio indicates how much of the company's assets are funded by debt compared to equity. A higher financial leverage ratio suggests that the company is relying more on debt to finance its operations, which can increase financial risk but also potentially lead to higher returns for equity investors.

In the most recent quarter (Q4 2023), the financial leverage ratio was 3.22, indicating a moderate level of leverage compared to previous quarters. The lower ratio in Q3 2023 (2.71) suggests that the company had reduced its reliance on debt in that period. The spike in the financial leverage ratio to 5.40 in Q1 2022 raises concerns as it indicates a high level of debt relative to equity, which could potentially strain the company's financial position.

Overall, while fluctuations in the financial leverage ratio are common for companies, investors and analysts should monitor changes in the ratio to assess the company's financial health and risk profile.