Penn National Gaming Inc (PENN)

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	16,064,200	16,168,600	17,028,000	17,040,000	17,502,100	17,535,100	17,880,800	18,071,100	16,872,100	15,748,700	15,078,200	14,888,200	14,667,300	14,812,000	14,321,500	13,938,400	14,194,500	14,318,000	14,321,500	13,498,200
Total stockholders’ equity	US$ in thousands	3,202,100	3,482,600	4,210,300	4,176,300	3,597,700	3,617,100	3,766,800	3,953,500	4,097,800	3,071,900	2,958,300	2,756,300	2,656,200	2,633,700	1,506,200	1,278,400	1,852,700	1,939,800	1,891,910	1,861,820
Financial leverage ratio		5.02	4.64	4.04	4.08	4.86	4.85	4.75	4.57	4.12	5.13	5.10	5.40	5.52	5.62	9.51	10.90	7.66	7.38	7.57	7.25

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $16,064,200K ÷ $3,202,100K
= 5.02

Financial leverage ratio measures the extent to which a company relies on debt to finance its operations and growth. It is calculated by dividing total assets by total equity. A higher financial leverage ratio indicates higher financial risk due to higher debt levels.

Based on the data provided for PENN Entertainment Inc, the financial leverage ratio has fluctuated over the past eight quarters. In Q4 2023, the ratio stood at 5.02, which was the highest among the reported periods, indicating a significant reliance on debt to fund the company's assets. This could potentially increase the financial risk for the company as a higher debt level may lead to higher interest expense and potential repayment challenges.

In comparison, the financial leverage ratio was relatively lower in Q2 2023 and Q1 2023 at 4.04 and 4.08, respectively. Although still indicating a considerable debt-to-equity ratio, the lower values suggest a reduced level of financial risk compared to Q4 2023. Similarly, in Q3 2023, the ratio was 4.64, reflecting a slightly higher leverage compared to Q2 and Q1 2023.

Looking further back, the financial leverage ratio was relatively stable in Q4 2022, Q3 2022, Q2 2022, and Q1 2022, ranging between 4.57 and 4.86. These values indicate a consistent reliance on debt financing during these periods, with no significant spikes in financial risk.

Overall, monitoring PENN Entertainment Inc's financial leverage ratio is crucial for assessing the company's capital structure and evaluating its risk exposure. It is essential for investors and stakeholders to track these trends to understand how the company is managing its debt levels and the potential implications for its financial health and stability.