Pool Corporation (POOL)
Financial leverage ratio
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 3,428,070 | 3,430,730 | 3,680,580 | 3,862,830 | 3,565,440 | 3,688,060 | 3,962,100 | 3,882,140 | 3,230,130 | 2,282,230 | 2,214,040 | 2,141,690 | 1,739,670 | 1,587,590 | 1,654,800 | 1,747,780 | 1,483,270 | 1,481,410 | 1,690,580 | 1,678,350 |
| Total stockholders’ equity | US$ in thousands | 1,312,790 | 1,418,230 | 1,458,530 | 1,256,750 | 1,235,190 | 1,190,880 | 1,229,060 | 1,174,280 | 1,071,390 | 985,212 | 874,748 | 657,928 | 639,470 | 589,501 | 486,791 | 348,398 | 410,180 | 405,970 | 343,169 | 224,877 |
| Financial leverage ratio | 2.61 | 2.42 | 2.52 | 3.07 | 2.89 | 3.10 | 3.22 | 3.31 | 3.01 | 2.32 | 2.53 | 3.26 | 2.72 | 2.69 | 3.40 | 5.02 | 3.62 | 3.65 | 4.93 | 7.46 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $3,428,070K ÷ $1,312,790K
= 2.61
The financial leverage ratio of Pool Corporation has fluctuated over the past eight quarters, ranging from a low of 2.42 in Q3 2023 to a high of 3.31 in Q1 2022. The ratio measures the extent to which the company relies on debt to finance its operations. A higher ratio indicates a higher level of financial leverage, meaning that the company has more debt relative to its equity.
The decreasing trend in the financial leverage ratio from Q1 2022 to Q3 2023 suggests that Pool Corporation has been gradually reducing its reliance on debt for financing its activities. This trend could be a positive sign, indicating a more conservative approach to capital structure management and potentially lower financial risks in the future.
However, the ratio increased in Q4 2023 compared to the previous quarter, reaching 2.61, which could raise concerns about a potential shift towards higher leverage again. It would be important for stakeholders to monitor future changes in the financial leverage ratio to assess the company's financial health and risk profile accurately.