Impinj Inc (PI)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 359,409 | 349,737 | 315,537 | 207,616 | 215,046 |
| Total stockholders’ equity | US$ in thousands | 34,131 | 15,591 | -11,076 | 109,119 | 125,239 |
| Financial leverage ratio | 10.53 | 22.43 | — | 1.90 | 1.72 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $359,409K ÷ $34,131K
= 10.53
The financial leverage ratio measures the extent to which a company relies on debt to finance its operations and growth. A higher financial leverage ratio indicates a higher level of debt relative to equity, which can increase financial risk but also potentially enhance returns.
In the case of Impinj Inc, there has been significant fluctuation in its financial leverage ratio over the past five years. The ratio stood at 1.72 in 2019, indicating a moderate level of debt relative to equity. This suggests a conservative capital structure at that time.
However, the financial leverage ratio increased significantly to 1.90 in 2020, reflecting a slightly higher dependence on debt for financing. The ratio then surged to 22.43 in 2022, pointing towards a substantial increase in leverage, which could potentially raise concerns about the company's financial stability and ability to manage its debt obligations.
The most recent data shows a financial leverage ratio of 10.53 as of December 31, 2023. While this represents a decrease from the previous year, the ratio still indicates a significant reliance on debt for funding the company's operations.
Overall, the trend in Impinj Inc's financial leverage ratio suggests a notable shift in its capital structure towards a higher level of leverage in recent years, which may warrant close monitoring to assess the associated risks and implications for the company's financial health and stability.
Peer comparison
Dec 31, 2023