Treehouse Foods Inc (THS)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 4,106,600 | 4,253,900 | 5,207,800 | 5,485,700 | 5,139,400 |
| Total stockholders’ equity | US$ in thousands | 1,664,800 | 1,687,000 | 1,845,400 | 1,865,000 | 1,830,900 |
| Financial leverage ratio | 2.47 | 2.52 | 2.82 | 2.94 | 2.81 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,106,600K ÷ $1,664,800K
= 2.47
The financial leverage ratio for Treehouse Foods Inc has shown a decreasing trend from 2.94 in 2020 to 2.47 in 2023. This indicates that the company has been gradually reducing its reliance on debt to finance its operations and investments over the years. A lower financial leverage ratio is generally considered favorable as it signifies lower financial risk and greater financial stability. However, it is important to note that a financial leverage ratio of 2.47 in 2023 still indicates that a significant portion of the company's assets are being financed by debt, which should be carefully managed to ensure sustainable growth and profitability. Overall, the decreasing trend in the financial leverage ratio demonstrates a prudent approach to capital structure management by Treehouse Foods Inc.
Peer comparison
Dec 31, 2023