Parsons Corp (PSN)

Financial leverage ratio

		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	Dec 31, 2019
Total assets	US$ in thousands	5,443,340	5,238,730	5,098,440	4,804,060	4,732,990	4,507,510	4,255,810	4,198,140	4,094,990	4,109,800	3,808,840	3,830,940	3,823,930	3,839,300	3,865,000	3,937,700	3,918,760	3,451,180	3,488,600	3,450,370
Total stockholders’ equity	US$ in thousands	2,312,450	2,218,510	2,149,670	2,287,210	2,172,740	2,119,430	2,063,880	2,043,570	1,953,070	1,928,180	1,918,190	1,900,770	1,824,080	1,813,460	1,796,800	1,813,770	1,727,500	1,667,550	1,635,260	1,629,890
Financial leverage ratio		2.35	2.36	2.37	2.10	2.18	2.13	2.06	2.05	2.10	2.13	1.99	2.02	2.10	2.12	2.15	2.17	2.27	2.07	2.13	2.12

September 30, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,443,340K ÷ $2,312,450K
= 2.35

The financial leverage ratio of Parsons Corp has shown some fluctuations over the periods analyzed. The ratio has ranged from 1.99 to 2.37, with the most recent value being 2.35 as of September 30, 2024. This indicates that the company has been utilizing debt to finance its operations and investments, with an average leverage ratio of approximately 2.13 over the period.

A financial leverage ratio of 2.35 means that for every dollar of equity, Parsons Corp has $2.35 of debt. This suggests that the company relies significantly on debt to fund its assets and operations, which can increase financial risk but also potentially amplify returns for shareholders when the business performs well.

It is important for stakeholders to closely monitor changes in the financial leverage ratio, as significant increases may signal increased financial risk and potentially constrain the company's financial flexibility. Conversely, decreasing ratios could indicate a more conservative financial strategy.

Overall, while the financial leverage ratio of Parsons Corp has been relatively stable around the 2.13 level over the periods analyzed, it is essential for investors and creditors to consider the company's leverage position in conjunction with other financial metrics to gain a comprehensive understanding of its financial health and risk profile.