Trex Company Inc (TREX)
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 | 1,324,300 | 1,267,220 | 1,269,930 | 1,292,960 | 932,885 | 996,812 | 1,069,820 | 1,133,120 | 933,705 | 841,898 | 887,294 | 972,396 | 920,321 | 953,451 | 898,820 | 900,290 | 770,492 | 718,235 | 670,990 | 630,856 |
| Total stockholders’ equity | US$ in thousands | 850,142 | 887,904 | 894,900 | 804,146 | 716,671 | 691,651 | 623,525 | 560,177 | 518,349 | 556,538 | 641,475 | 721,065 | 725,034 | 720,809 | 648,776 | 590,143 | 588,531 | 544,064 | 499,661 | 451,723 |
| Financial leverage ratio | 1.56 | 1.43 | 1.42 | 1.61 | 1.30 | 1.44 | 1.72 | 2.02 | 1.80 | 1.51 | 1.38 | 1.35 | 1.27 | 1.32 | 1.39 | 1.53 | 1.31 | 1.32 | 1.34 | 1.40 |
December 31, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,324,300K ÷ $850,142K
= 1.56
The financial leverage ratio of Trex Company Inc has fluctuated over the reporting periods provided. It indicates the degree to which the company relies on debt financing in its capital structure.
The ratio decreased from 1.40 as of March 31, 2020, to 1.27 as of December 31, 2021, signaling a reduction in the company's reliance on debt during this period. However, from there, the ratio began to increase steadily, reaching a peak of 2.02 as of March 31, 2023, before declining again.
The increase in the financial leverage ratio could suggest that Trex Company Inc took on more debt to fund its operations or expansion activities. Conversely, a decline in the ratio may indicate a decrease in the company's debt levels relative to its equity, which could imply a stronger financial position and lower risk.
It is important for stakeholders to closely monitor the financial leverage ratio to assess the company's ability to meet its financial obligations and manage its debt effectively. Additionally, analyzing trends in this ratio can provide insights into the company's financial stability and risk profile over time.
Peer comparison
Dec 31, 2024