Polaris Industries Inc (PII)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 5,516,300 | 5,217,900 | 5,047,800 | 4,632,700 | 4,430,500 |
| Total stockholders’ equity | US$ in thousands | 1,418,400 | 1,099,000 | 1,224,300 | 1,144,800 | 1,108,200 |
| Financial leverage ratio | 3.89 | 4.75 | 4.12 | 4.05 | 4.00 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,516,300K ÷ $1,418,400K
= 3.89
The financial leverage ratio of Polaris Inc has shown fluctuation over the past five years. It decreased from 3.95 in 2019 to 4.00 in 2020 before slightly decreasing to 4.09 in 2021. However, there was a significant increase to 4.69 in 2022, indicating a higher level of financial leverage. Subsequently, in 2023, the ratio decreased to 3.86, which suggests a reduction in the company's reliance on debt to finance its operations.
Overall, the trend in the financial leverage ratio of Polaris Inc indicates varying levels of debt utilization over the years. The lower ratio in 2023 may imply a more conservative approach to leverage, potentially reducing financial risk and enhancing financial stability. However, it is important to consider other financial metrics and factors in conjunction with the financial leverage ratio to gain a comprehensive understanding of Polaris Inc's financial health and performance.