Pinnacle West Capital Corp (PNW)
Financial leverage ratio
| Dec 31, 2024 | Sep 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 26,102,800 | 26,309,600 | 25,701,100 | 24,847,700 | 24,661,200 | 24,434,400 | 23,979,300 | 23,580,400 | 22,723,400 | 22,844,600 | 22,501,500 | 22,201,000 | 22,003,200 | 21,536,400 | 21,061,600 | 20,184,700 | 20,020,400 | 19,751,400 | 19,307,400 | 18,561,800 |
| Total stockholders’ equity | US$ in thousands | 6,754,310 | 6,616,580 | 6,211,140 | 6,199,030 | 6,177,660 | 6,374,680 | 5,966,920 | 6,048,920 | 6,048,650 | 6,244,560 | 5,908,280 | 5,930,570 | 5,906,200 | 6,064,880 | 5,717,620 | 5,682,520 | 5,633,500 | 5,841,390 | 5,489,560 | 5,469,420 |
| Financial leverage ratio | 3.86 | 3.98 | 4.14 | 4.01 | 3.99 | 3.83 | 4.02 | 3.90 | 3.76 | 3.66 | 3.81 | 3.74 | 3.73 | 3.55 | 3.68 | 3.55 | 3.55 | 3.38 | 3.52 | 3.39 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $26,102,800K ÷ $6,754,310K
= 3.86
The financial leverage ratio of Pinnacle West Capital Corp has shown a gradual increase from 3.39 as of March 31, 2020, to 4.14 as of June 30, 2024. This indicates that the company's reliance on debt to finance its operations and growth has been increasing over the period under review. A higher financial leverage ratio suggests that a significant portion of the company's assets are funded by debt rather than equity.
The fluctuations in the financial leverage ratio may reflect changes in the company's capital structure and borrowing activities. It is important to note that a higher financial leverage ratio can amplify the company's returns on equity in favorable conditions, but it also exposes the company to increased financial risk, especially during economic downturns or periods of high interest rates.
Investors and stakeholders should closely monitor the trend in the financial leverage ratio to assess the company's ability to meet its debt obligations, manage financial risks, and maintain a healthy balance between debt and equity financing. Additionally, a thorough analysis of the company's overall financial health, profitability, and cash flow generation is crucial to gain a comprehensive understanding of its financial position.
Peer comparison
Dec 31, 2024