Pure Storage Inc (PSTG)
Financial leverage ratio
| Feb 4, 2024 | Nov 5, 2023 | Aug 6, 2023 | Feb 5, 2023 | Nov 6, 2022 | Aug 7, 2022 | May 8, 2022 | Feb 6, 2022 | Oct 31, 2021 | Aug 1, 2021 | May 2, 2021 | Jan 31, 2021 | Nov 1, 2020 | Aug 2, 2020 | May 3, 2020 | Feb 2, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 3,655,760 | 3,355,510 | 3,133,920 | 3,543,460 | 3,252,820 | 3,049,860 | 2,828,350 | 3,135,320 | 2,855,760 | 2,783,680 | 2,697,940 | 2,819,440 | 2,653,000 | 2,321,610 | 2,254,860 | 2,364,200 | 2,192,780 | 2,115,970 | 2,069,190 | 1,973,020 |
| Total stockholders’ equity | US$ in thousands | 1,270,090 | 1,148,460 | 986,328 | 941,233 | 840,508 | 761,358 | 727,094 | 754,336 | 724,424 | 697,444 | 715,473 | 750,006 | 735,081 | 746,106 | 756,858 | 830,118 | 777,950 | 737,539 | 743,976 | 737,780 |
| Financial leverage ratio | 2.88 | 2.92 | 3.18 | 3.76 | 3.87 | 4.01 | 3.89 | 4.16 | 3.94 | 3.99 | 3.77 | 3.76 | 3.61 | 3.11 | 2.98 | 2.85 | 2.82 | 2.87 | 2.78 | 2.67 |
February 4, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $3,655,760K ÷ $1,270,090K
= 2.88
The financial leverage ratio of Pure Storage Inc has shown some fluctuation over the period indicated. The ratio has ranged from a low of 2.67 to a high of 4.16. Generally, a higher financial leverage ratio indicates a higher level of debt financing relative to equity.
From the data provided, Pure Storage Inc's financial leverage ratio increased from 2.67 in January 2019 to 4.16 in February 2022, suggesting a significant increase in debt relative to equity during this period. Subsequently, the ratio decreased to 2.88 by February 2024, indicating a reduction in financial leverage.
It is important to note that a high financial leverage ratio implies higher financial risk due to increased reliance on debt, which can amplify both returns and losses. On the other hand, a lower ratio signifies a more conservative capital structure with lower debt levels.
The trend in Pure Storage Inc's financial leverage ratio indicates some variability in the company's financing structure over time, reflecting potential changes in its capital allocation strategy and risk profile. It would be advisable for stakeholders to monitor this ratio closely to assess the company's risk exposure and financial stability.
Peer comparison
Feb 4, 2024