Reliance Steel & Aluminum Co (RS)
Financial leverage ratio
| Dec 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 10,021,800 | 10,300,800 | 10,448,100 | 10,712,200 | 10,547,800 | 10,492,900 | 10,440,400 | 10,203,200 | 10,329,900 | 10,202,200 | 10,402,700 | 10,114,200 | 9,536,000 | 9,252,400 | 8,930,000 | 8,549,000 | 8,106,800 | 7,998,700 | 7,724,100 | 8,085,500 |
| Total stockholders’ equity | US$ in thousands | 7,219,600 | 7,350,500 | 7,623,000 | 7,932,400 | 7,722,300 | 7,724,300 | 7,615,600 | 7,345,700 | 7,087,400 | 6,846,700 | 6,854,300 | 6,531,300 | 6,086,500 | 5,860,700 | 5,631,700 | 5,342,800 | 5,115,400 | 5,039,800 | 4,953,900 | 4,892,200 |
| Financial leverage ratio | 1.39 | 1.40 | 1.37 | 1.35 | 1.37 | 1.36 | 1.37 | 1.39 | 1.46 | 1.49 | 1.52 | 1.55 | 1.57 | 1.58 | 1.59 | 1.60 | 1.58 | 1.59 | 1.56 | 1.65 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $10,021,800K ÷ $7,219,600K
= 1.39
The financial leverage ratio of Reliance Steel & Aluminum Co has shown a decreasing trend over the analyzed period, starting at 1.65 as of March 31, 2020, and gradually declining to 1.39 as of March 31, 2024.
This indicates that the company's reliance on debt has been decreasing relative to its equity over time. A lower financial leverage ratio generally suggests a lower level of financial risk because it indicates that the company is using less debt to finance its operations.
It is important to note that a declining trend in the financial leverage ratio could also indicate that the company is becoming less aggressive in its capital structure and potentially limiting its growth opportunities that could be funded through debt.
Overall, the decreasing trend in Reliance Steel & Aluminum Co's financial leverage ratio signals a more conservative approach to its capital structure management, potentially improving its financial stability and resilience to economic downturns.