PVH Corp (PVH)

Financial leverage ratio

		Feb 4, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Feb 2, 2020
Total assets	US$ in thousands	11,172,900	11,768,300	12,396,800	13,293,500	13,631,000
Total stockholders’ equity	US$ in thousands	5,118,900	5,012,700	5,288,800	4,730,300	5,811,500
Financial leverage ratio		2.18	2.35	2.34	2.81	2.35

February 4, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $11,172,900K ÷ $5,118,900K
= 2.18

The financial leverage ratio of PVH Corp has exhibited some fluctuations over the past five years. As of February 4, 2024, the financial leverage ratio stands at 2.18, representing a decrease compared to the previous year when it was at 2.35. This indicates that the company has reduced its reliance on debt financing to support its operations and growth.

In comparison to the financial leverage ratio of 2.81 in January 31, 2021, the current ratio is notably lower, suggesting that PVH Corp has been successful in managing its debt levels more effectively in recent years.

The financial leverage ratio measures the extent to which a company is using debt to finance its operations. A lower ratio indicates lower financial risk and greater stability, as the company is relying less on debt to fund its activities. This can be viewed positively by investors and creditors as it signifies a healthy balance between debt and equity in the company's capital structure.

Overall, the decreasing trend in PVH Corp's financial leverage ratio over the past few years reflects a more conservative approach to financing and strengthens the company's financial position. This indicates a prudent financial management strategy that aims to reduce risk and enhance long-term sustainability.