Sensata Technologies Holding NV (ST)

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 7,143,260 7,314,330 8,189,440 7,615,950 7,680,990 8,388,340 8,392,600 8,584,850 8,756,220 8,712,620 8,606,680 8,611,390 8,613,770 8,504,760 8,418,360 7,945,190 7,844,200 7,559,490 7,084,880 6,812,820
Total stockholders’ equity US$ in thousands 2,890,440 2,957,770 3,011,550 2,974,830 2,996,280 3,225,180 3,209,770 3,193,490 3,110,810 3,069,320 3,023,580 3,072,320 3,094,730 3,009,620 2,913,450 2,790,640 2,705,490 2,574,640 2,493,400 2,537,800
Financial leverage ratio 2.47 2.47 2.72 2.56 2.56 2.60 2.61 2.69 2.81 2.84 2.85 2.80 2.78 2.83 2.89 2.85 2.90 2.94 2.84 2.68

December 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $7,143,260K ÷ $2,890,440K
= 2.47

The financial leverage ratio of Sensata Technologies Holding NV has been relatively stable over the past several quarters, ranging between 2.47 and 2.94. This ratio measures the company's level of debt relative to its equity, indicating the extent to which the company relies on debt financing.

A financial leverage ratio of 2.47 implies that for every dollar of equity, the company has $2.47 of debt. A higher leverage ratio suggests a higher level of financial risk due to increased reliance on debt to finance operations, while a lower ratio indicates a more conservative financial structure.

Sensata's financial leverage ratio trending downwards since the peak in September 2020, when it reached 2.94, may indicate a reduction in the proportion of debt in its capital structure. However, the ratio has remained relatively consistent and within a manageable range, indicating a balanced approach to financing operations.

Overall, a financial leverage ratio around 2.5 to 3 suggests a moderate level of financial leverage for Sensata Technologies Holding NV, which could be considered acceptable depending on the industry and the company's overall financial health.