Packaging Corp of America (PKG)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 8,681,100 | 8,003,800 | 7,836,800 | 7,433,200 | 7,235,800 |
| Total stockholders’ equity | US$ in thousands | 3,997,300 | 3,667,100 | 3,607,200 | 3,246,300 | 3,071,000 |
| Financial leverage ratio | 2.17 | 2.18 | 2.17 | 2.29 | 2.36 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $8,681,100K ÷ $3,997,300K
= 2.17
The financial leverage ratio of Packaging Corp of America has exhibited a slight fluctuation over the past five years. The ratio decreased from 2.36 in 2019 to 2.17 in 2021 before slightly increasing to 2.18 in 2022, and then remaining steady at 2.17 in 2023.
A financial leverage ratio of 2.17 to 2.36 indicates that the company's capital structure is geared more towards debt rather than equity. This level of leverage suggests that the company may have a higher risk due to its reliance on debt to finance its operations and investments.
It is important for investors and stakeholders to closely monitor the financial leverage ratio over time to assess the company's ability to meet its debt obligations and manage financial risk effectively. Additionally, fluctuations in the ratio may indicate changes in the company's financial structure and risk profile.
Peer comparison
Dec 31, 2023