Ross Stores Inc (ROST)

Financial leverage ratio

		Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
Total assets	US$ in thousands	14,300,100	13,416,500	13,640,300	12,717,900	9,348,370
Total stockholders’ equity	US$ in thousands	4,871,330	4,288,580	4,060,050	3,290,640	3,359,250
Financial leverage ratio		2.94	3.13	3.36	3.86	2.78

February 3, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $14,300,100K ÷ $4,871,330K
= 2.94

The financial leverage ratio of Ross Stores Inc has exhibited fluctuation over the past five years. The ratio was at its lowest in February 2020 at 2.78, indicating a lower level of financial leverage at that time. However, the ratio has since increased, reaching its peak at 3.86 in January 2021 before gradually declining in subsequent years.

A financial leverage ratio above 1 suggests that the company relies more on debt financing than equity financing. Ross Stores Inc's financial leverage ratio has consistently been above 1 in the past five years, indicating a higher level of debt usage in its capital structure. The decreasing trend in the ratio from 3.86 in 2021 to 2.94 in 2024 suggests a potential shift towards a lower reliance on debt financing relative to equity.

It is important for investors and stakeholders to closely monitor changes in the financial leverage ratio as it reflects the company's risk exposure and ability to meet its debt obligations. The declining trend in Ross Stores Inc's financial leverage ratio may indicate a more conservative approach to capital structure management in recent years.