Quanta Services Inc (PWR)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 16,237,200 | 13,464,300 | 12,855,200 | 8,398,270 | 8,331,680 |
| Total stockholders’ equity | US$ in thousands | 6,272,240 | 5,383,460 | 5,112,300 | 4,344,180 | 4,050,290 |
| Financial leverage ratio | 2.59 | 2.50 | 2.51 | 1.93 | 2.06 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $16,237,200K ÷ $6,272,240K
= 2.59
The financial leverage ratio of Quanta Services, Inc. has shown fluctuating trends over the past five years. It increased from 2.06 in 2019 to 2.59 in 2023, reaching its highest point in this period. This indicates that the company has been relying more on debt to finance its operations and growth, relative to its equity.
A high financial leverage ratio suggests a higher level of financial risk as the company has a larger proportion of debt in its capital structure. While debt can amplify returns, it also magnifies losses, especially in times of economic uncertainty or downturns.
It is important for investors and stakeholders to closely monitor changes in the financial leverage ratio of Quanta Services, Inc. to assess the company's ability to meet its financial obligations and navigate potential challenges in the future.
Peer comparison
Dec 31, 2023