PACCAR Inc (PCAR)

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	40,823,400	38,039,500	36,867,700	34,826,400	33,275,500	30,623,600	30,588,700	30,586,100	29,509,400	27,909,900	29,012,200	28,503,400	28,450,000	27,233,700	26,406,400	27,294,700	28,361,100	27,767,700	27,168,200	26,157,000
Total stockholders’ equity	US$ in thousands	15,878,800	16,023,100	15,079,300	13,882,000	13,167,100	12,893,500	12,518,000	12,143,300	11,594,000	11,479,800	11,330,300	10,861,700	10,533,300	10,184,400	9,776,800	9,637,400	9,706,100	9,962,700	9,635,400	9,105,500
Financial leverage ratio		2.57	2.37	2.44	2.51	2.53	2.38	2.44	2.52	2.55	2.43	2.56	2.62	2.70	2.67	2.70	2.83	2.92	2.79	2.82	2.87

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $40,823,400K ÷ $15,878,800K
= 2.57

Paccar Inc.'s financial leverage ratio has shown some fluctuations over the past eight quarters. The ratio ranged from a low of 2.37 in Q3 2023 to a high of 2.57 in Q4 2023. Generally, the company's financial leverage ratio has been relatively stable, hovering around 2.5 over the period analyzed. This indicates that Paccar relies more on debt financing compared to equity financing, with an average leverage of 2.47 over the eight quarters.

A financial leverage ratio of 2.47 suggests that for every dollar of equity invested in the company, Paccar has approximately $2.47 in debt. While leverage can amplify returns when the business is performing well, it also increases financial risk as the company has higher financial obligations to meet. Paccar's consistent financial leverage ratio indicates a consistent approach to capital structure management over the analyzed period. It is important for investors and stakeholders to monitor this ratio to assess the company's risk and financial stability.