Thermo Fisher Scientific Inc (TMO)

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	98,726,000	97,057,000	94,105,000	94,658,000	97,154,000	90,536,000	90,579,000	92,747,000	95,123,000	73,600,000	67,698,000	65,931,000	69,052,000	64,061,000	61,593,000	58,688,000	58,381,000	56,729,000	57,970,000	55,596,000
Total stockholders’ equity	US$ in thousands	46,735,000	45,328,000	43,752,000	42,257,000	43,978,000	43,549,000	42,293,000	40,956,000	40,793,000	38,710,000	36,854,000	35,058,000	34,507,000	31,824,000	29,875,000	28,559,000	29,675,000	29,355,000	28,729,000	27,693,000
Financial leverage ratio		2.11	2.14	2.15	2.24	2.21	2.08	2.14	2.26	2.33	1.90	1.84	1.88	2.00	2.01	2.06	2.05	1.97	1.93	2.02	2.01

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $98,726,000K ÷ $46,735,000K
= 2.11

The financial leverage ratio of Thermo Fisher Scientific Inc. has exhibited some fluctuations over the past eight quarters, ranging from a low of 2.08 in Q3 2022 to a high of 2.26 in Q1 2022. This ratio measures the proportion of the company's total assets that are financed by debt as opposed to equity.

A higher financial leverage ratio indicates a higher level of debt used to finance the company's assets, which can magnify returns on equity when business is good but can also increase financial risk during economic downturns or challenging operating conditions. In the case of Thermo Fisher Scientific Inc., the ratio has generally trended upwards over the period, reaching a recent peak of 2.26 in Q1 2022 before slightly decreasing to 2.11 in Q4 2023.

While a higher leverage ratio can potentially increase profitability through magnified returns on equity, it also exposes the company to greater financial risk, especially in times of economic uncertainty. It is important for investors and analysts to monitor Thermo Fisher Scientific Inc.'s financial leverage ratio over time to assess its capital structure and evaluate the company's ability to meet its debt obligations.