Tennant Company (TNC)
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 | 1,190,100 | 1,216,100 | 1,167,500 | 1,151,700 | 1,113,400 | 1,059,300 | 1,108,300 | 1,100,700 | 1,085,100 | 1,005,100 | 1,025,200 | 1,050,200 | 1,061,700 | 1,067,100 | 1,081,400 | 1,080,800 | 1,082,600 | 1,063,500 | 1,028,200 | 1,150,200 |
| Total stockholders’ equity | US$ in thousands | 620,800 | 647,200 | 624,600 | 614,600 | 577,000 | 545,000 | 520,600 | 491,900 | 470,800 | 425,200 | 432,700 | 436,000 | 433,800 | 441,800 | 436,200 | 420,100 | 404,800 | 393,900 | 371,700 | 357,300 |
| Financial leverage ratio | 1.92 | 1.88 | 1.87 | 1.87 | 1.93 | 1.94 | 2.13 | 2.24 | 2.30 | 2.36 | 2.37 | 2.41 | 2.45 | 2.42 | 2.48 | 2.57 | 2.67 | 2.70 | 2.77 | 3.22 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,190,100K ÷ $620,800K
= 1.92
The financial leverage ratio of Tennant Company has shown a decreasing trend over the past few years, indicating a positive shift towards a lower level of leverage. This ratio measures the proportion of the company's debt to its equity, reflecting the extent to which the company relies on debt financing.
From March 31, 2020, when the ratio stood at 3.22, there has been a gradual decline to reach 1.92 by December 31, 2024. This indicates a reduction in the company's reliance on debt financing relative to its equity. Lower financial leverage ratios are generally considered favorable as they suggest lower financial risk and greater financial stability.
The decrease in the financial leverage ratio of Tennant Company could be due to various factors such as improved operating performance, increased profitability, or a deliberate strategy to reduce debt levels. This trend indicates that the company may be managing its capital structure more efficiently to enhance its financial health and resilience. Nonetheless, it is essential to continue monitoring this ratio to ensure a balanced capital structure that supports sustainable growth and profitability.
Peer comparison
Dec 31, 2024