Parker-Hannifin Corporation (PH)

Financial leverage ratio

		Jun 30, 2024	Mar 31, 2024	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
Total assets	US$ in thousands	29,297,800	29,578,300	29,694,900	29,592,700	29,964,500	30,515,700	30,520,900	29,954,900	25,943,900	22,545,300	22,395,500	20,236,900	20,341,200	19,841,500	19,827,400	19,785,900	19,887,800	20,365,300	21,044,000	19,568,600
Total stockholders’ equity	US$ in thousands	12,072,000	11,590,900	11,302,600	10,565,400	10,326,900	9,781,300	9,322,380	8,762,520	8,848,010	8,959,870	8,755,080	8,490,780	8,398,310	7,392,200	7,105,980	6,528,960	6,227,220	6,295,990	6,330,180	6,096,620
Financial leverage ratio		2.43	2.55	2.63	2.80	2.90	3.12	3.27	3.42	2.93	2.52	2.56	2.38	2.42	2.68	2.79	3.03	3.19	3.23	3.32	3.21

June 30, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $29,297,800K ÷ $12,072,000K
= 2.43

The financial leverage ratio of Parker-Hannifin Corporation has shown fluctuations over the periods indicated in the table. The ratio, which measures the company's use of debt to finance its operations and is calculated as total assets divided by total equity, has ranged between 2.38 and 3.42 during the past few years.

The trend in the financial leverage ratio indicates that the company has been managing its debt levels relative to its equity in a variable manner. A higher financial leverage ratio generally implies a greater reliance on debt financing, which can amplify both profits and losses. Conversely, a lower ratio suggests a more conservative capital structure with less reliance on debt.

It is essential for stakeholders to closely monitor changes in the financial leverage ratio, as it can impact the company's financial stability and risk profile. Furthermore, understanding the reasons behind fluctuations in the ratio can provide insights into the company's capital structure decisions and financial health over time.