Texas Pacific Land Trust (TPL)
Financial leverage ratio
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 1,259,170 | 1,156,400 | 1,079,320 | 1,001,320 | 955,251 | 877,427 | 828,974 | 764,708 | 856,569 | 764,064 | 695,617 | 633,843 | 613,802 | 571,635 |
| Total stockholders’ equity | US$ in thousands | 1,122,450 | 1,043,200 | 964,558 | 887,550 | 829,051 | 772,887 | 721,170 | 645,281 | 727,876 | 651,711 | 601,042 | 547,177 | 513,935 | 485,184 |
| Financial leverage ratio | 1.12 | 1.11 | 1.12 | 1.13 | 1.15 | 1.14 | 1.15 | 1.19 | 1.18 | 1.17 | 1.16 | 1.16 | 1.19 | 1.18 |
March 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,259,170K ÷ $1,122,450K
= 1.12
The financial leverage ratio of Texas Pacific Land Trust has been relatively stable over the past several quarters, ranging from 1.11 to 1.19. The ratio indicates that the trust has been employing moderate levels of financial leverage, with a slight increasing trend in recent quarters.
A financial leverage ratio above 1 signifies that the trust has more debt in its capital structure than equity. A ratio of 1.12 to 1.19 suggests that Texas Pacific Land Trust's assets are financed by more debt than equity, indicating a higher level of financial risk compared to a company with a lower leverage ratio.
It is essential for stakeholders to monitor the trend in the financial leverage ratio over time to assess the trust's ability to meet its debt obligations and its overall financial stability. However, a single financial ratio like the leverage ratio should be evaluated in conjunction with other financial metrics and qualitative factors to gain a comprehensive understanding of the trust's financial health and risk profile.