Sonic Automotive Inc (SAH)

Financial leverage ratio

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Total assets	US$ in thousands	5,364,600	5,050,300	5,081,600	5,148,000	4,978,300	4,828,300	5,023,500	5,006,200	4,975,100	3,505,960	3,656,340	3,692,230	3,746,000	3,503,920	3,595,420	3,976,740	4,071,040	4,117,890	4,119,330	4,139,090
Total stockholders’ equity	US$ in thousands	891,900	857,500	876,700	854,800	895,200	1,106,900	1,170,000	1,135,000	1,076,400	1,005,800	946,400	826,400	814,800	774,102	744,702	721,987	944,800	902,425	875,725	852,286
Financial leverage ratio		6.01	5.89	5.80	6.02	5.56	4.36	4.29	4.41	4.62	3.49	3.86	4.47	4.60	4.53	4.83	5.51	4.31	4.56	4.70	4.86

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $5,364,600K ÷ $891,900K
= 6.01

The financial leverage ratio for Sonic Automotive, Inc. has shown an upward trend in the most recent quarters. In Q4 2023, the financial leverage ratio increased to 6.01 from 5.89 in Q3 2023. This indicates that the company has increased its reliance on debt financing compared to its equity.

Looking back over the past year, there has been a noticeable increase in the financial leverage ratio from Q1 2022 to Q4 2023. This suggests that Sonic Automotive, Inc. has been taking on more debt to support its operations or expansion activities.

It is important for investors and stakeholders to monitor this trend closely as a high financial leverage ratio can indicate a higher level of financial risk for the company. The company's ability to manage and service its debt obligations effectively will be crucial in maintaining financial stability and long-term sustainability.