Insulet Corporation (PODD)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,588,200 | 2,251,100 | 2,048,800 | 1,872,900 | 1,142,900 |
| Total stockholders’ equity | US$ in thousands | 732,700 | 476,400 | 556,300 | 603,600 | 75,900 |
| Financial leverage ratio | 3.53 | 4.73 | 3.68 | 3.10 | 15.06 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,588,200K ÷ $732,700K
= 3.53
The financial leverage ratio measures the extent to which a company utilizes debt in its capital structure. Insulet Corporation's financial leverage ratio has fluctuated over the past five years, ranging from a low of 3.10 in 2020 to a high of 15.06 in 2019.
In 2023, the financial leverage ratio decreased to 3.53 from 4.73 in 2022, indicating a reduction in the company's reliance on debt financing. A lower financial leverage ratio suggests a stronger equity position relative to debt, which can be seen as a positive sign of financial stability.
Comparing the current ratio to 2021 and 2020, Insulet Corporation's financial leverage ratio of 3.53 in 2023 is lower than both years, indicating a conservative approach to debt management. However, it is significantly higher compared to 2019, where the ratio spiked to 15.06, suggesting a higher level of financial risk and leverage at that time.
Overall, the decreasing trend in the financial leverage ratio for Insulet Corporation from 2022 to 2023 reflects a move towards a more balanced capital structure with less reliance on debt to finance its operations, which could be viewed positively by investors and creditors.
Peer comparison
Dec 31, 2023