Texas Pacific Land Trust (TPL)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|
| Total assets | US$ in thousands | 1,156,400 | 877,427 | 764,064 | 571,635 |
| Total stockholders’ equity | US$ in thousands | 1,043,200 | 772,887 | 651,711 | 485,184 |
| Financial leverage ratio | 1.11 | 1.14 | 1.17 | 1.18 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,156,400K ÷ $1,043,200K
= 1.11
The financial leverage ratio of Texas Pacific Land Trust has been steadily decreasing over the past four years, indicating a trend towards lower reliance on debt financing compared to equity. This suggests that the company's financial structure is becoming more conservative and less leveraged over time. The decreasing trend in the financial leverage ratio may indicate a stronger financial position and reduced risk of financial distress, as the company relies less on external borrowing to fund its operations and growth. Additionally, a lower financial leverage ratio signals a healthier balance sheet with a lower level of debt relative to equity, which can be viewed positively by investors and creditors. Overall, the decreasing trend in the financial leverage ratio reflects a more stable and sustainable financial profile for Texas Pacific Land Trust.