Sonoco Products Company (SON)
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 | 7,191,960 | 7,270,000 | 7,048,990 | 7,061,430 | 7,052,940 | 6,975,650 | 6,989,510 | 6,955,990 | 5,073,240 | 4,925,150 | 4,994,040 | 5,280,750 | 5,277,260 | 5,767,230 | 5,738,860 | 5,012,140 | 5,126,290 | 4,986,180 | 4,945,560 | 4,941,500 |
| Total stockholders’ equity | US$ in thousands | 2,424,340 | 2,332,540 | 2,292,350 | 2,198,400 | 2,065,810 | 1,928,610 | 1,929,680 | 1,911,790 | 1,837,440 | 1,849,990 | 1,811,440 | 1,902,400 | 1,899,600 | 1,871,140 | 1,797,340 | 1,744,260 | 1,802,680 | 1,841,680 | 1,840,360 | 1,788,180 |
| Financial leverage ratio | 2.97 | 3.12 | 3.08 | 3.21 | 3.41 | 3.62 | 3.62 | 3.64 | 2.76 | 2.66 | 2.76 | 2.78 | 2.78 | 3.08 | 3.19 | 2.87 | 2.84 | 2.71 | 2.69 | 2.76 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $7,191,960K ÷ $2,424,340K
= 2.97
Sonoco Products Co.'s financial leverage ratio has fluctuated over the past eight quarters, ranging from 2.97 to 3.64. A higher financial leverage ratio indicates higher financial risk due to a greater reliance on debt financing.
The trend shows a general increase in the financial leverage ratio from Q4 2022 to Q1 2023, peaking at 3.64 in Q1 2022. This suggests that the company has been taking on more debt relative to its equity over time. However, from Q1 2023 to Q4 2023, there is a slight decline in the ratio, indicating a potential decrease in the level of leverage or a strengthening of the equity position.
It is essential for investors and stakeholders to monitor the financial leverage ratio closely as it can impact the company's solvency and financial stability. A high leverage ratio can magnify both positive and negative financial performance, increasing returns in good times but also amplifying losses during downturns.
Peer comparison
Dec 31, 2023